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SAN FRANCISCO 
PUBLIC LIBRARY 

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City and County of San Francisco 

Meeting .Minutes 
^Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-4689 



Wednesday, March 03, 1999 
>.35V * 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



Hi 



DOCUMENTS DFPT 



Meeting Convened 

The meeting convened at 10:10 a.m. 

REGULAR AGENDA 



MAR 3 1 1999 

SAN FRANCISCO 
p UBLIC LIBRARY 



981933 [Police Department Executive Appointments] Supervisors Leno, Bierman 

Ordinance amending Administrative Code Section 2A.76 to allow for appointments to non-civil service 
exempt ranks of the Police Department to be made from the ranks of lieutenant and above. 

(Amends Section 2A.76.) 

1 1/16/98, RECEIVED AND ASSIGNED to Housing and Neighborhood Services Committee. 

1/25/99, TRANSFERRED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Lori Giorgi, Deputy City Attorney. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 

981934 [Police Department Executive Appointments] Supervisors Leno, Bierman 

Ordinance amending Administrative Code Section 2A.77 to allow the Chief of Police to appoint exempt non- 
civil service executives from the rank of lieutenant and above. 

(Amends Section 2A.77.) 

1 1/16/98, RECEIVED AND ASSIGNED to Housing and Neighborhood Services Committee. 

1/25/99, TRANSFERRED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Lori Giorgi, Deputy dry Attorney. 
RECOMMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 






City and County of San Francisco 



Primed al 5:0.? PM on .1/4/99 



3 1223 05718 3338 



Finance and Labor Committee 



Meeting Minutes 



March 3, 1999 



990091 [Interdepartmental Jurisdictional Transfer] 



Supervisor Bierman 



Ordinance transferring jurisdiction over certain real property located at Drumm Street, between Clay and 
Washington Streets, described generally as Assessor's Block 202, Lots 6, 14 and a portion of 15, excluding the 
subsurface thereof, and a portion of Assessor's Block 203, Lot 14, from the Department of Public Works to the 
Recreation and Park Commission; and providing that no building, improvement or structure may be 
constructed on the surfaces of such parcels and adjoining Assessor's Block 202, Lot 18. 

1/19/99, ASSIGNED to Finance and Labor Committee. 

2/10/99, CONTINUED. Heard in Committee. Speakers: Eula Walters. Continued to February 24, 1999. 

2/24/99, CONTINUED. Continued to March 3, 1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Bierman; Supervisor Ammiano 
In Support: Ernestine Weiss; Dave Burnett; Barbara Kerwick; Jane Morrison; Carolyn Blair; Eula Walters; 
Isabel Wade; Herb Lembcke; Lynne Juarez. 

In Opposition: Nan McGuire, Friends ofTule Elk Park; Paul Growald; Gail Getty; Marion Page; Diana 
Rogers; Walter Miller; Donald Green, Laural Heights Association; Martin Rosen; Betty Landis; Ron Miguel; 
Jan Lassetter; Peter Boy er; Simon Hurd, S.F. League of Urban Gardners; John Norwood; Peter Winkelstein, 
SPUR Urban Affairs Committee; Dee Dee Workman, S. F. Beautiful; Howard Strassner, Sierra Club; Harry 
Overstreet, Architect for Butterfly Discovery Park Project. 
RECOMMENDED by the following vote: 
Ayes: 2 - Bierman, Ammiano 
Noes: 1 - Yee 
990115 (Appropriation, Mayor's Office-Peninsula Corridors Joint Powers 
Board] 

Ordinance appropriating $830,760, Mayor's Office, General Fund Reserve, to increase the appropriation 
amount for the Peninsula Corridor Joint Powers Board Agency subsidy payments for fiscal year 1998-1999. 
(Controller) 

(Fiscal impact.) 

1/20/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Bruce Balshone, Coalition for One Stop 
Terminal; Howard Strassner; Jan Morrison; Supervisor Ammiano; Supervisor Bierman. Amended on lines 1, 
13, 16, and 17 to increase appropriation from "$830,760" to "$830,921". Supervisor Bierman added as 
sponsor. 
AMENDED. 

Ordinance appropriating $830,921, Mayor's Office, General Fund Reserve, to increase the appropriation 
amount for the Peninsula Corridor Joint Powers Board Agency subsidy payments for fiscal year 1998-1999. 
(Controller) 

(Fiscal impact.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 

990163 [Reserved Funds, Public Transportation Commission] 

Hearing to consider release of reserved funds, Public Utilities Commission, (Federal Section 9 Funds, 
Resolution No. 319-94), in the amount of $1,187,241, to continue project parts procurement activities related 
to the MUNI Diesel Bus Rehabilitation Program. (Public Transportation Commission) 

1/28/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Jerry Levine, Grants Administrator for MUNI; 
Supen'isor Ammiano; Walt Podesto, MUNI. Request for release ofresen'e amended to reduce requested 
amount from "$1, 187,241 " to "$1, 147,866" per Budget Analyst recommendations 
AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 5:03 PM on 3/4^9 



7 45243 SFPL: ECONO JRS 
206 SFPL 11/22/00 63 



Finance and Labor Committee 



Meeting Minutes 



March 3, 1999 



-" 



Hearing to consider release of reserved funds, Public Utilities Commission, (Federal Section 9 Funds, 
Resolution No. 319-94), in the amount of 51,147,866 to continue project parts procurement activities related to 
the MUNI Diesel Bus Rehabilitation Program. (Public Transportation Commission) 

APPROVED AND FILED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 

990170 [Year 2000 Full Count Committee - Census Count] Supervisors Ammiano, Yee, 

Bierman 

Resolution establishing a Year 2000 Complete Count Advisory Committee to develop and coordinate a census 
implementation plan for the City and County of San Francisco and to act as liaison to the Census Bureau to 
ensure a complete count in the year 2000, establishing the membership and rules for the committee, setting a 
deadline for a committee recommendation on an adequate level of City funding to supplement Census 
Bureau's outreach efforts, and urging City Departments, City-funded community based organizations, the 
Chancellor of City college and the Superintendent of SF Unified School District to promote local census 
participation. 

2/1/99, RECErVED AND ASSIGNED to Housing and Social Policy Committee. 
2/3/99, TRANSFERRED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst,; Supervisor Ammiano; Supervisor Teng; Ted 
Whang, Chinese for Affirmative Action; Artis Cooper, NAACP; Hoi Yung Poon, Census Bureau; John Young, 
Department of Human Resources; Supervisor Yee; Supervisor Bierman. Supervisor Bierman added as 
cosponsor. 

CONTINUED TO CALL OF THE CHAD* by the following vote: 
Ayes: 3 - Bierman, Ammiano, Yee 
990312 [Fiscal Condition of the City and County of San Francisco] Supervisor Yee 

Hearing to review and consider the Controller's six-month budget status report issued February 9, 1999; the 
three-year budget forecast to be issued jointly by the Controller, Mayor and the Budget Analyst within the next 
two to three weeks; specific budget problem areas such as workers' compensation spending, overtime spending 
and San Francisco General Hospital and Laguna Honda Hospital revenues and expenditures; any structural 
problems in the budget, such as items that have been built into the budget that will cause us trouble in future 
years. 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Ed Harrington, Controller; Supervisor Yee; Supervisor Ammiano; Dr. 
Mitchell Katz, Director, Public Health Department; Supervisor Bierman; Bill Lee, City Administrator; 
Matthew Hymel, Budget Director, Mayor's Office; Harvey Rose, Budget Analyst. 
FILED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 
ADJOURNMENT 

The meeting adjourned at 1:35 p.m. 



Cily and County of San Francisco 



Printed at 5:03 PM on 3/4JV9 



Public Library, Gov't Information Ctr.. 5 th Fir. 
Attn: Susan Horn, Dept. 41 



to. 25V 

3 



CITY AND COUNTY 




OF SAN FRANCISCO 



BOARD OF SUPERVISORS 



BUDGET ANALYST 



DOCUMENTS DEPT. 

MAR 2 egg 

|ANFRA NCI SC0 
PU BL/C LIBRARY 



1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



February 26, 1999 
TO: ^Finance and Labor Committee 

FROM: t Budget Analyst 

SUBJECT: March 3, 1999 Finance and Labor Committee Meeting 
Items 1 and 2 - Files 98-1933 and 98-1934 



Department: 
Item: 



Description: 



Police 

File No. 98-1933 

Ordinance amending Chapter 2A, Article IV, Section 
2A.76 of the Administrative Code to allow the Police 
Commission to create exempt non-civil service ranks to 
which members of the civil service ranks of Lieutenant 
and above can be appointed by the Chief of Police. 

File No. 98-1934 

Ordinance amending Chapter 2A, Article IV, Section 
2A.77 of the Administrative Code to allow the Chief of 
Police to appoint exempt non-civil service executives from 
the civil service ranks of Lieutenant and above. 

File No. 98-1933 

The proposed ordinance would amend Chapter 2A, Article 
IV, Section 2A.76 of the Administrative Code to give the 
Police Commission the power to create civil service- 
exempt ranks to which members of the Police Department 
with a civil service rank of Lieutenant or higher may be 
appointed by the Chief of Police. Presently, the 
Administrative Code gives the Commission the power to 
create civil service-exempt ranks to which members of the 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



Department with the civil service rank of Captain or 
higher, not Lieutenant or higher, can be appointed by the 
Chief of Police. Additionally, this proposed amendment 
requires that a Lieutenant appointed by the Chief of 
Police to any non-civil service rank above Captain must 
have worked for a six month probationary period and 
served an additional six months as a permanent employee 
in that rank. This requirement is not currently in the 
Administrative Code. 

File No. 98-1934 

The proposed ordinance would amend Chapter 2A, Article 
IV, Section 2A.77 of the Administrative Code to give the 
Chief of Police the power to appoint members of the Police 
Department with a civil service rank of Lieutenant or 
higher to any of the Department's non-civil service ranks 
above Captain. Presently, the Administrative Code gives 
the Chief of Police the power to appoint civil service 
members of the Department with a rank of Captain or 
higher, not Lieutenant or higher, to any of the 
Department's non-civil service ranks above Captain 
Additionally, this proposed amendment requires that to 
be eligible for appointment to any non-civil service rank 
above Captain, a Lieutenant must have worked for a six 
month probationary period and served an additional six 
months as a permanent employee in that rank. This 
requirement is not currently in the Administrative Code. 



Comments: 



1. The Attached memo from Ms. Lori Giorgi of the City 
Attorney's Office briefly explains the purpose of this 
proposed legislation. 



Recommendation: 



2. According to Ms. Giorgi, there would be no fiscal impact 
to the City, as the proposed amendments to the 
Administrative Code are intended only to codify current 
practices, and there would be no related increase or 
decrease in Police Department authorized positions. 

Approval of the proposed ordinance is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 
2 



City and County of San Francisco 



Louise H. Renns 




City Attorney 



Office of the City Attorney 

loretta m. giorgi 
Chief Attorney - Public 
Protection Unit 

Direct Dial: (41 S) 554-4222 
E-mail- lori_giorgi@ci_sf.caus 



MEMORANDUM 



TO: RICHARD RA YA, BUDGET ANALYST' S OFFICE 

FROM: LORETTA M. GIORGI 

Chief Attorney - Public Protection Unit 

DATE: December 17, 1998 

RE: PROPOSED LEGISLATION AMENDING THE SAN FRANCISCO 

ADMINISTRATIVE CODE REGARDING MINIMUM REQUIREMENTS FOR 
SELECTION OF POLICE DEPARTMENT COMMAND STAFF 

As you know, the Police Department Consent Decree was recently terminated. As part of 
the effort to institutionalize the Department's employment practices under the decree, the City 
needs to make some amendments to the Administrative Code. 

Prior to the implementation of the decree in 1979, the San Francisco Charter provided 
that all command level staff had to be appointed from the rank of Captain and above. 

Under the 1979 Consent Decree these Charter provisions were suspended and the court 
ordered that command level appointments should be made from the ranks of Lieutenant and 
above. The reason for these modifications was that there were few or no minorities or women in 
the Captain rank from which to select command staff. In order to fully integrate all ranks of the 
department, it was decided that the Chief would be allowed to choose from a larger pool of 
candidates if he could select persons from the Lieutenant rank as well as the Captain rank. 

In 1995, the Charter was amended by the electorate. The Charter provisions regarding 
the appointment of command staff were moved to the Administrative Code. However, these 
provisions were not amended to conform with the practice under the Consent Decree. 

In order to continue this practice after termination of the decree, the Board of Supervisors 
must amend these ordinances. The Department, Police Commission and Police Officer's 
Association have successfully held a "meet and confer" session and agreed to the amendments as 
set forth in this legislation. 

If you have any further questions regarding these amendments, please do not hesitate to 
contact me. 



FoxPla2a • 1390 Market Stret, 5th Floor • San Francisco, California 94102-5408 
Reception: (415) 554-4283 • Facsimile: (415) 554-4248 



^^OC^|^m^JOlCrO'^rtxJ'Acnr^.O•Cf^CWnmJT^•^^ 



TOTAL P. 01 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 

Item 3 - File 99-0091 

Note: This item was continued by the Finance and Labor Committee at its meeting 
of February 24, 1999. 



Department: 
Item: 



Description: 



Department of Public Works (DPW) 
Recreation and Park Department (RPD) 

Ordinance transferring jurisdiction over certain real 
property located at Drumm Street between Clay and 
Washington Streets, described generally as Assessor's 
Block 202, Lots 6, 14 and a portion of 15, excluding the 
subsurface rights thereof, and a portion of Assessor's 
Block 203, Lot 14, from the Department of Public Works 
to the Recreation and Park Commission; and providing 
that no building, improvement or structure may be 
constructed on the surfaces of such parcels and adjoining 
Assessor's Block 202, Lot 18. 

The proposed ordinance would transfer jurisdiction over 
certain real property from DPW to RPD excluding the 
subsurface rights to a portion of the property. According 
to Mr. Joel Robinson of RPD, approval of this ordinance 
would preserve the property for use as open space subject 
to the possible construction of an underground parking 
facility on this property. The construction of an 
underground parking facility would require separate 
approval by the Board of Supervisors. 

On July 18, 1994, the City acquired from the State certain 
real property comprised of Assessor's Block 202, Lots 6, 14 
and portion of 15, and a portion of Assessor's Block 203, 
Lot 14 (collectively, the "Property"). The Property is 
located immediately northwest of Justin Herman Plaza, 
between the Embarcadero to the west and Davis Street to 
the east, and between Washington Street to the north and 
Clay Street to the south, as shown on the attached map. 
The Property is currently held under the jurisdiction of 
the Department of Public Works. The Recreation and 
Park Commission has jurisdiction over adjoining 
property, Assessor's Block 202, Lot 18 (Lot 18). The 
subject Property and the adjoining property are used as 
open space. 

The proposed ordinance would subject the Property and 
the adjoining Lot 18 to the restriction that no building, 
improvement or structure may be constructed on the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



surfaces of the Property and Lot 18, provided that the 
following improvements would not be prohibited: (a) 
landscape improvements such as pedestrian pathw 
gazebos, tables, benches lighting fixtures, trash 
receptacles, automatic public toilets, bicycle racks and 
drinking fountains, and (b) improvements necessary to 
the functioning of a potential underground parking 
facility if such improvements cannot be constructed 
underground. 

Jurisdiction over portions of the Property's subsurface, 
specifically Assessor's Block 202, Lots 6, 14, and a portion 
of 15, is to be retained by DPW because on September 18, 
1996, the Board of Supervisors preliminarily endorsed 
construction of an underground public parking facility 
with a capacity for up to 350 vehicles on this Property 
(File No. 47-96-8). This endorsement by the Board of 
Supervisors was subject to the condition that construction 
of an underground parking facility would not commence 
until the City executed a contract with a developer for a 
major renovation of the Ferry Building, located 
approximately 500 feet to the east of the Subject Property, 
across the Embarcadero, with the understanding, 
according to Mr. Alec Bash of the Port, that any such 
parking facility would serve the public needs associated 
with a renovated Ferry Building. According to the 
proposed ordinance, the Port is currently negotiating with 
a developer, William Wilson and Associates, for the 
renovation of the Fern- Building. 

On November 4. 1996, the Board of Supervisors approved 
the Final Environmental Impact Report for the 
Alternatives to Replacement of the Embarcadero Freeway 
and the Terminal Separator Structure, which set forth 
several surface traffic improvements, including the 
widening of Washington and Clay Streets between Davis 
and Drumm Streets, which would consist of certain 
improvements to a portion of Block 203, Lot 14 (File No. 
271-96-3). The proposed ordinance states that to "widen 
Washington and Clay Streets, the property line for 
Assessor's block 203, Lot 14 would be shifted 
approximately 17.40 feet to the south on the Washington 
Street frontage and approximately 17.61 feet to the north 
on the Clay Street frontage and two portions of Assessor's 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

5 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



Comment: 



Recommendation: 



Block 203 (collectively the "Reserved Street Widening 
Parcels), will thereby be a part of the widened 
Washington and Clay Streets." 

Ms. Mariam Morley of the City Attorney's Office states 
that these Reserved Street Widening Parcels do not 
consist of that portion of Block 203, Lot 14 included in the 
Property proposed to be transferred from the jurisdiction 
of DPW to the jurisdiction of RPD. However, this proposed 
ordinance states "In the event that Washington and Clay 
streets are not widened within five years after the 
effective date of this Ordinance, the Director of Property 
shall recommend to the Board of Supervisors that, subject 
to the California Environmental Quality Act and other 
applicable laws, the jurisdiction of the Reserved Street 
Widening Parcels be transferred to the Recreation and 
Park Commission" and that the property comprising the 
Reserved Street Widening Parcels be subjected to the 
same development limitations as the subject Property. 
Therefore, according to Ms. Morley, the Reserved Street 
Widening Parcels, as land adjoining the subject Property 
described above, would serve as preserved open space in 
combination with the Property. 

As previously noted, the Property is currently used as 
open space. Mr. Robinson stated that RPD already 
provides gardeners to maintain the Property, excluding 
the portion of Assessor's Block 203, Lot 14, which is 
maintained by DPW. Mr. Robinson advises that RPD is 
not planning any improvements to the Property and 
therefore, Mr. Robinson anticipates no fiscal impact from 
the proposed jurisdictional transfer. 

Approval of the proposed ordinance is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

6 



Attachment 




Memo to Finance Committee 

March 3. 1999 Finance and Labor Committee Meeting; 



Item 4 -File 99-0115 

Department: 

Item: 



Amount: 
Source of Funds: 
Description: 



Mayor's Office 

Supplemental Appropriation Ordinance appropriating 
S830.760 from the General Fund Reserve to (1) increase 
the FY 1998-99 appropriation amount for subsidy 
payments to the Peninsula Corridor Joint Powers Board 
(JPB) and (2) fund the installment payment for the City's 
share of start-up costs of the JPB. 

S830.760 (see Comment) 

General Fund Reserve 

In August of 1991. the City entered into a Joint Powers 
Agreement (JPA) with the San Mateo County Transit 
District (SamTrans) and the Santa Clara County Transit 
District regarding the Peninsula Corridor Project. The 
Peninsula Corridor Project involves the Caltrain route 
that currently extends from Gilroy to San Francisco. At 
that time, a Joint Powers Board (JPB) was established as 
the eventual successor to the California Department of 
Transportation (Caltrans) to oversee the Caltrain 
operator, which is currently Amtrak. 

The JPB consists of nine members, three of which 
represent the City and County of San Francisco. One 
member is appointed by the Mayor, one is appointed by 
the Board of Supervisors and one is appointed by the 
Public Transportation Commission (PTC). The JPB 
provides for the allocation among the JPB members of the 
administrative, capital and operating expenses in 
connection with the above-noted Peninsula Corridor 
Project. 

Approximately 40 percent of Caltrains operating costs are 
recovered through fares, resulting in a 60 percent annual 
operating deficit. The annual Federal subsidy is 
subtracted from the 60 percent deficit. The balance, after 
subtracting the Federal subsidy is, under the current 
provisions of the JPA, borne by the counties of San 
Francisco, San Mateo and Santa Clara based on their 



BOARD OF SUPERVISORS 

BUDGET ANALYST 



Memo to Finance Committee 

March 3, 1999 Finance and Labor Committee Meeting 



respective percentages of morning commute boardings, as 
determined during a survey held the previous year. 

According to Mr. Ben Rosenfield of the Mayor's Office of 
Public Finance, during the formulation of the City's FY 
1998-99 budget, the JPB failed to provide the City with 
adequate survey data on San Francisco's share of morning 
boardings. As a result, the Mayor's Office of Public- 
Finance estimated, based on previous annual percentage 
increases in morning boardings, that San Francisco's 
share of morning boardings grew by 10 percent, from 16 
percent to 17.6 percent of total morning boardings in FY 
1997-98. Mr. Rosenfield states that based on these 
estimates of ridership, the Mayor's Office of Public 
Finance calculated that San Francisco's share of the 
JPB's FY 1998-99 operating expenses in connection with 
the Peninsula Corridor Project would be $4,648,351, 
which was appropriated by the Board of Supervisors for 
subsidy payments to the JPB in the City's FY 1998-99 
budget. 

However, according to Mr. Jim Gallagher of the JPB, San 
Francisco's share of morning boardings actually grew by 
17.5 percent, from 16 percent to 18.8 percent of total 
morning boardings in FY 1997-98. Mr. Rosenfield 
therefore reports that San Francisco's share of the JPB's 
FY 1998-99 operating expenses in connection with the 
Peninsula Corridor Project is $5,349,646, or $701,295 
more than the current FY' 1998-99 appropriation amount 
of $4,648,351. Attachment I, provided by Mr. Gallagher, 
contains allocated amounts, by County, for JPB's FY 
1998-99 budgeted costs in connection with the Peninsula 
Corridor Project. 

Approval of the proposed supplemental appropriation 
would increase the current FY 1998-99 appropriation 
amount for San Francisco's share of the JPB's FY 1998-99 
operating expenses in connection with the Peninsula 
Corridor Project by $701,295. from $4,648,351 to 
$5,349,646. 

Mr. Gallagher states that if the JPB does not receive the 
additional needed $701,295, this would result in a 



BOARD OF SUPERVISORS 

BUDGET ANALYST 



Memo to Finance Committee 

March 3, 1999 Finance and Labor Committee Meeting 



reduction of scheduled Caltrain service in connection the 
Peninsula Corridor Project beginning in May of 1999. 

According to Mr. Gallagher, the JPB began operations in 
July of 1992. A total of $5,465,539 was required for the 
JPB's start-up costs. Mr. Gallagher advises that the three 
counties agreed that San Mateo's share of such start-up 
costs would be $2,787,425 (51 percent) and Santa Clara's 
share would be $2,120,629 (38.8 percent), with the 
balance of $557,485 (10.2 percent) representing San 
Francisco's share of the start-up costs. According to Mr. 
Gallagher, San Mateo and Santa Clara Counties have 
previously paid their share of such costs. The three 
counties also agreed that San Francisco would pay its 
share of the start-up costs of $557,485 plus seven percent 
interest over five years beginning in FY 1993-94, in 
accordance with the payment schedule shown in 
Attachment II, provided by Mr. Gallagher. The proposed 
supplemental appropriation would provide for San 
Francisco's fifth and last installment payment of 
$129,626, as reflected in Attachment II. 



Comment: 



Recommendation: 



Based on (1) $701,295 to provide the balance of San 
Francisco's share of the JPB's FY 1998-99 operating 
expenses in connection with the Peninsula Corridor 
Project and (2) $129,626 for San Francisco's final 
payment for the JPB's start-up costs, San Francisco's 
total requirement is $830,921 or $161 more than this 
request of $830,760. 

Amend the proposed ordinance to increase the amount of 
this ordinance by $161 from $830,760 to $830,921, and 
approve the proposed ordinance as amended. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

10 



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FEB. -25' 99CTHU) 14:47 SAMTRAKS TEL: 1 415 508 6281 P. 002 

Attachment II 

DATE: February 25, 1999 

TO: Gabe Cabrera 

FROM: Jim Gallagher ' 

SUBJECT: SAN FRANCISCO REMITTANCES, JPB STARTUP COSTS 

Joint Powers Board records show the following schedule of remittances for Caltrain 
startup costs by the City and County of San Francisco: 

Date Received Payment Amount 

March 1, 1995 $129,300.00 

July 1, 1995 $129,500.00 

July 1, 1996 $129,500.00 

July 1, 1997 $129,500.00 

July 1. 1998 $129.625.78 

TOTAL $647,425.78 



12 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 

Item 5 - File 99-0163 



Department: 



Item: 



Amount: 
Source of Funds: 

Description: 



Public Transportation Commission (PTC) 
Municipal Railway (Muni) 

Hearing to consider the release of reserved funds in the 
amount of $1,187,241 from previously authorized Federal 
Operating and Capital Assistance Funds, including 
matching funds from a combination of State, Regional and 
Local sources for three Municipal Railway Projects. 

$1,187,241 (See Comment No. 1) 

Federal grant funds, including matching funds from a 
combination of State, Regional and Local sources. 

In April of 1994, the Board of Supervisors authorized 
Muni to apply for, accept and expend grant funds in the 
amount of $26,748,583 from Federal grants including 
matching funds from a combination of State, Regional and 
Local sources (File 94-93-3). Of the total funds of 
$26,748,583, $2,165,366 was placed on reserve for the 
Muni Metro Accessibility Improvements, Diesel Bus 
Rehabilitation and Subway Signal System Replacement 
Projects, pending the selection of contractors and the 
submission of project cost details. Of the $2,165,366 
placed on reserve, $1,017,500 was subsequently released 
for Phase I & II of the Muni Metro Accessibility Project, 
leaving a current balance on reserve of $1,147,866. This 
request would authorize the release of all remaining 
reserved funds (See Comment No. 1). 

The requested funds would be used to partially finance 
the rehabilitation of 34 articulated diesel buses as part of 
the Muni Diesel Bus Rehabilitation Program, which seeks 
to rehabilitate Muni's articulated diesel buses that have 
either exceeded their economic useful life or are now in 
need of a mid-life overhaul. The total cost to rehabilitate 
these 34 buses is estimated to be $1,520,653 (see 
Comment No. 2). 

Of the $1,520,653, $240,000 would be used to purchase 
engines for 10 M.A.N, articulated buses that have 
exceeded their economic useful life. According to Mr. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



13 



Memo to Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



Jerry Levine of Mum, these 10 coaches, which were 
purchased in 1984, exceeded their economic useful life in 
1996 and have become difficult and costly to maintain. 
While an order for new diesel coaches has been placed, 
the new vehicles will not be delivered for approximately 
two years. Mr. Levine advises that this purchase of 10 
new engines will help to enhance vehicle availability until 
the new diesel coaches arrive in approximately 2001. 

The remaining $1,280,653 of the $1,520,653 total 
estimated cost would be used to rehabilitate 24 
articulated coaches, purchased in 1991, which are now in 
need of a mid-life overhaul. Mr. Levine advises that these 
funds would be used to purchase parts for power delivery 
systems (transmissions), cooling systems, suspension 
(axles), and structural improvements. 



Budget: 



The Attachment, provided by 
program budget details. 



MUNI, outlines the 



Comments: 



1. As previously noted, the current balance in reserved 
funds is $1,147,866, which is $39,375 less than the 
$1,187,241 request. As such, the subject request should 
be reduced by $39,375, from $1,187,241 to $1,147,866. 



2. As noted above, the total cost to rehabilitate the 34 
diesel buses is estimated to be $1,520,653. According to 
Mr. Levine, the balance of $372,787 ($1,520,653 project 
costs less $1,147,866 in reserved funds) would be funded 
with either existing or future grant funds. 



Recommendations: 



1. Reduce the subject request by $39,375, from $1,187,241 
to $1,147,866, in accordance with Comment No. 1. 



2. Release funds in the amount of $1,147,866. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



14 



rtD"ir~i333 j.«-fj.i 



New Flyer Diesel Coach 
Rehab Project 



Attachment 



Estimated Parts Procurement Cost 



Components 


Ouantirv 


Front Axle Assy. 


24 ea. 


Wheelchair Lift Assy. 


24 ea. 


Window Kits 


24 ca. 


Seating & Inserts 


24 ea. 


TSI Restraint 


24 ea. 


Destination Signs 


23 ea. 


M.A.N. Reman. Engines 


10 ea 


Interlube System 


23 ea 


HTB-748 Transmissions 


19 ea. 


Subtotal Parts 




Sales Tax 




Contingency Costs 




Current Total 




Current Funds on Reserve 




Difference 





Estimated Cost 

$ 159,552.00 
$ 172,800.00 
$ 17,760.00 
$ 176,304.00 
$ 12,000.00 
$. 281,089.00 
$ 240,000.00 
$ 24,495.00 
$ 404,700.00 
$1,488,700.00 
$ 16^22.00 
$ 15,631.00 
$1,520,653.00 
$1,147,866.00 
$ 372,787.00 



Information provided by : 

Walt Podesta - Contractual Services Manager , Muni Diesel Modal 
Ken Sapp - Maintenance Supervisor / N.F. Rehab Project Manager 



TOTAL P. 02 



15 



Memo to the Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



Item 6 -File 99-0170 

Department: 

Item: 



Description: 



Mayor 

Resolution (a) establishing a Year 2000 Complete Count 
Advisory Committee to develop and coordinate a census 
implementation plan for the City and County of San 
Francisco, and to act as a liaison to the U. S. Census 
Bureau to ensure a complete count in Year 2000; (b) 
establishing the membership and rules for the 
Committee; (c) setting a deadline for the Committee to 
recommend an adequate level of City funding to 
supplement the U. S. Census Bureau's outreach efforts; 
(d) urging City departments, City-funded community- 
based organizations, the Chancellor of the Community 
College District, and the Superintendent of the San 
Francisco Unified School District to promote local census 
participation. 

According to Mr. John Young of the Department of 
Human Services, the 1990 Census taken by the U. S. 
Census Bureau failed to count over 837,000 people in the 
State of California, including 21,600 San Francisco 
residents, or 2.98 percent of the City's total population, 
which was reported as 723,959 in the 1990 Census. 

Mr. Young reports that, as a result of the undercount in 
the 1990 Census, San Francisco receives $3,240,000 less 
annually in Federal funding than it would have received 
otherwise, based on $150 annually in Federal funding for 
each person undercounted, times 21,600 undercounted 
residents. According to Mr. Young, the estimate of $150 
was provided by the U. S. Census Bureau. 

Additionally, as a result of the undercount in the 1990 
Census, San Francisco receives $2,052,000 less annually 
in State funding than it would have received otherwise, 
based on $95 annually in State funding for each person 
undercounted, times 21,600 undercounted residents. 
According to Mr. Young, the amount of $95 is an 
estimated provided by the U. S. Census Bureau. 
Therefore, according to Mr. Young, due to the undercount 
in the 1990 Census, San Francisco receives $5,292,000 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



16 



Memo to the Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 

less annually in Federal and State funding combined than 
it would have received had the 1990 Census been correct. 

Under the proposed resolution, a Complete Count 
Advisory Committee would be established and would 
consist of at least 17 members, including: the Director of 
Human Services; the Director of Public Health; the 
Executive Director of the San Francisco Housing 
Authority; the Mayor's Homeless Coordinator; 11 
representatives of community-based organizations that 
provide services to historically undercounted 
communities, each appointed by the members of the 
Board of Supervisors; one representative appointed by the 
Board of Education, and one representative from the 
Community College Board. A committee of similar 
composition already exists, and is involved in planning for 
the implementation activities of the proposed resolution. 

Under the proposed resolution the Committee would 
implement its primary objective to prevent undercounting 
in the Year 2000 U. S. Census to be taken by the U. S. 
Census Bureau. The Committee would undertake media 
outreach and engage the public through promotional 
events, encouraging people to participate in the Year 2000 
Census, establishing support centers for completing 
Census forms, and serving as liaison to the U.S. Census 
Bureau. The Committee would also develop and 
coordinate a Census implementation plan for the City and 
County of San Francisco. This implementation plan 
would create a Census telephone hotline, coordinate with 
community centers, assist the San Francisco branch of the 
U. S. Census Bureau recruit approximately 1,200 
counters to follow-up on completed Census forms in San 
Francisco, and ensure that multiple languages and 
outreach efforts are employed to reach historically 
undercounted communities in San Francisco. 

Fiscal Impact: Under the proposed resolution, the adequacy of funding in 

the City's FY 1999-2000 budget to supplement the U. S. 
Census Bureau's outreach effort and to facilitate" 
partnerships between the U. S. Census Bureau, local 
government agencies, and community-based 

organizations would be determined by the proposed 
Committee and would be subject to Board of Supervisors 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

17 



Memo to the Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 



appropriation approval. As of the writing of this report, 
Mr. Young does not know how much funding will be 
requested in the City's FY 1999-2000 budget to 
implement the activities of the Committee. 

As of the writing of this report, Mr. Young was not certain 
whether the Committee members would receive any 
compensation and/or reimbursement for expenses related 
to the Year 2000 Census. 



Comments: 



1. According to Mr. Young, the undercount in the 1990 
Census was determined by the Post Enumeration Survey, 
which was a survey conducted in 1991 by the U. S. 
Census Bureau to determine the extent of undercounting 
in the 1990 Census. 



2. Mr. Young expects that the proposed media outreach 
would commence in January of 2000. The U. S. Census 
Bureau is expected to mail the Census data forms to all 
official residential mailing addresses in San Francisco by 
April 1, 2000, and to do follow-up counts through July 
where residents have been unresponsive. At the end of 
the 2000, the statistics collected from the Year 2000 
Census will be delivered to the U. S. President. 

3. Mr. Young reports that the U. S. Census Bureau bases 
the Census on the ability of the Federal government to 
send Census data forms through official residential 
mailing addresses. Moreover, the Census data forms 
contain questions that, although available in other 
languages, are generally prepared in English. Therefore, 
those individuals without official residential mailing 
addresses or those persons who do not speak English are 
more difficult to reach and are more likely to be omitted 
from the Census. Among such individuals are homeless 
people, undocumented aliens, members of minority 
communities, and occupants of unofficial housing units, 
according to Mr. Young. 



Recommendation: 



Approval of the proposed resolution is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

18 



Memo to the Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 

Item 7 - File 99-0312 

1. This is a hearing to review and consider the Controller's six-month Budget 
Status Report issued February 9, 1999 and the three-year budget forecast to be 
issued jointly by the Controller, the Mayor's Director of Finance and the Budget 
Analyst. 

2. The Controller's six-month Budget Status Report included the following 
highlights: 

> The Controller projected an $86.0 million FY 1998-99 year-end balance that 
would be available as a source of funding for the FY 1999-2000 budget. The 
report noted that this projected year-end balance is $15.9 million less than 
the $101.9 million FY 1997-98 year-end balance that was used as a source of 
funding for the current FY 1998-99 budget. 

> Overall, revenues and other funding sources are projected by the Controller 
to be $38.3 million higher than the FY 1998-99 budget. Surplus revenues are 
being realized for Property Taxes ($19.27 million), Sales Taxes ($1.47 million) 
and Real Property Transfer Taxes ($5.93 million). In addition, the City will 
realize a one-time recovery of $17.6 million in Property Tax revenue 
previously transferred to School Districts between FY 1993-94 and FY 1996- 
97. 

It should be noted that some revenue sources are not meeting budgeted 
amounts. Specifically, Hotel Taxes are $3.1 million below budget and Utility 
User Taxes are projected at $2.9 million less than budget. Other revenue 
deficiencies include Recreation and Park Department revenues ($2.0 million) 
and, based on reduced concession and other non-aeronautical revenue, the 
Airport Revenue Transfer to the General Fund ($1.85 million). 

> General Fund expenditures are projected to be $4.9 million over budget 
overall. The Controller's six-month Budget Status Report notes Workers' 
Compensation spending, which exceeds General Fund budgeted amounts by a 
total of $8.67 million, is an issue that should be monitored. The report notes 
that most City Departments are able to cover excess Workers' Compensation 
spending through other budget savings, but that some departments will 
require a supplemental appropriation. 

The Controller's six-month Budget Status Report states that the following 
supplemental appropriations will be necessary: 

■ $2.1 million for the Fire Department to cover projected deficits in overtime 
due to the provision of additional emergency medical services, and 
salaries and benefits to begin two additional classes of Firefighters to 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

19 



Memo to the Finance and Labor Committee 

March 3, 1999 Finance and Labor Committee Meeting 

fulfill future staffing requirements. This supplemental appropriation has 
been submitted to the Finance and Labor Committee. 

■ $1.1 million for the Police Department's Workers' Compensation deficit. 
The Police Department is also exceeding its overtime budget by $1.5 
million, which is being offset by other salary savings. The Budget Analyst 
previously reported during the June, 1998 Finance Committee budget 
hearings that Police Overtime could be underfunded by $1.0 million. 

■ The six-month Budget Status Report states that the Sheriff will require a 
supplemental appropriation of $500,000 to cover deficits in Workers' 
Compensation and food supplies. Subsequently, the supplemental 
appropriation that has been submitted to the Finance and Labor 
Committee by the Mayor is approximately $1.3 million and includes 22 
new positions and funds for drug treatment program for inmates. 

■ The Controller projects that San Francisco General Hospital will have a 
$12.45 million deficit and that Laguna Honda Hospital will have a $5.1 
million deficit, for total projected Hospital deficits of $17.55 million. 
However, other budget savings in the Department of Public Health will 
reduce the net overall Departmental deficit to $5.1 million according to 
the Controller's six-month Budget Status Report, and a supplemental 
appropriation for $5.1 million will be required. 

3. The three-year budget forecast prepared jointly by the Controller, the 
Mayor's Director of Finance and the Budget Analyst will be issued on March 3, 
1999. 



Supervisor Yee 
Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 




'>/^L 



arvey M. Rose 



Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Gail Feldman 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



20 




City and County of San Francisco 

Meeting Minutes 

Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-4689 



Saturday, March 06, 1999 

25Y 



10:00 AM 

Special Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



OOCUMENTS DEPT. 



Meeting Convened 

The meeting convened at 10:08 a.m. 

REGULAR AGENDA 



m 3 1 m 

UB UC LIBRARY 



990252 [Living Wage Ordinance] Supervisors Ammiano, Bierman 

Hearing to consider the need for a living wage ordinance and what kind of living wage ordinance would be 
best for the City and County of San Francisco. 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Father Peter Sammon; Nettie Ceasar; Danny Elvena; Bernadine Emperodor: 
Garth Gandy, People Organized for Employment Rights (POWER): Martina Gills: Josie Moonie; Bob 
Planthold: Nancy Lewis, RN: Lucille Flato; Khilil Ali; Lester Martin: Darriel Loggins; Arthur Campagna; 
Hank, Robert Boileau; Jim Illig; Pat Breslin; Shirlley Bierly, Council for Older Americans: David 
Novogrodsky; Julia Lopez: Sam Sui; Garrett Jenkins; Frederick Hobson; Milissa Bowen; Mikki Ellis; Stan 
Thomson, POWER; Raymond Liu; Walter Johnson, S.F Labor Council; Rand Quinn, Coalition for Immigrant 
Rights; Richard Klinke; Jonathan Beauer; Charles Andrew; Ricardo Brooks Alba; Richard Ow; Dorothy 
James; Ed Williard; Marvin Warren; Fred Pecker; Dennis Kelly: Tim West; Denise D'Anne; Dawn Moore; 
Alma Santana; Criss Romero, Harvey Milk Democratic Club; Bill Price, President Senior Action Network; 
Erlinda Villa; Anna Sanchez; Richard Leung; Kent Mitchell; Jonathan Perez, Steven Curria; Margaret 
Hanlon-Gradie. Supervisor Bierman added as cosponsor . Continued to March 18, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Bierman, Ammiano 

Absent: 1 - Yee 

ADJOURNMENT 

The meeting adjourned at 12:10 p.m. 



City and County of San Francisco 



Printed at 3:43 PM on 3/8/99 




City and County of £an Francisco 

Meeting Minutes 

^Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102^689 



Wednesday, March 10, 1999 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



25¥ 



Members Present: Leland Y. Yee, Tom Ammiano. 
Members Absent: Sue Bierman. 



DOCUMENTS DEPT. 



Meeting Convened 

TTie meeting convened at 10:06 a.m. 

REGULAR AGENDA 



MAR 3 1 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



981443 [Taxi Permit Fee Adjustments] Supervisor Newsom 

Ordinance amending Police Code Sections 2.26.1 and 2.27.1 to adjust permit and license fee schedules for 
motor vehicles for hire and to give a 50-percent discount for four years on permit fees for taxicabs and ramped 
taxicabs operating on compressed natural gas and amending Sections 1080, 1088 and 1 125 to include fees 
authorized by those sections in permit and license fee schedules for motor vehicles for hire. 

(Amends Sections 2.26.1, 2.27.1, 1080, 1088, and 1125.) 

8/24/98, ASSIGNED UNDER 30 DAY RULE to Finance Committee, expires on 9/23/1998. 

1/25/99, TRANSFERRED to Finance and Labor Committee. 

CONTINUED TO CALL OF THE CHAIR by the following vote: 
Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990186 (Lease Amendment, Airport - U.S. Postal Service] 

Resolution approving First Amendment to lease of Airmail Field Post Office for increase in acreage and 
adjustment to rental to allow for expansion of the airmail facility between United States Postal Service and the 
City and County of San Francisco, acting by and through its Airport Commission. (Airport Commission) 

2/1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst: Jon Ballesteros, Airport: Supen'isor 
Ammiano, Supervisor Yee. Amended to allow retroactive approval to July 8, 1998: new title. 
AMENDED. 

Resolution approving retroactive to July 8, 1998, First Amendment to lease of Airmail Field Post Office for 
increase in acreage and adjustment to rental to allow for expansion of the airmail facility between United 
States Postal Service and the City and County of San Francisco, acting by and through its Airport Commission. 
(Airport Commission) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 3:54 PM on 3/1 W9 



Finance and Labor Committee 



Meeting Minutes 



March 10, 1999 



990206 [Airport Revenue Bonds] 

Resolution approving the issuance of up to $165,000,000 additional aggregate principal amount of San 
Francisco International Airport Second Series Revenue Bonds for the purpose of financing or refinancing 
certain infrastructure improvements at San Francisco International Airport, approving the substitution of a 
Letter of Credit for the San Francisco International Airport Commercial Paper Program, and approving the 
extension of the Airport's Refunding Bond authorization to April 30, 2003. (Airport Commission) 

2/3/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Jon Ballesteros, Airport; Supervisor Yee. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990237 [Police Sublease for Hunters Point Naval Shipyard] 

Resolution authorizing the Director of Real Estate to enter into an amended and restated sublease on behalf of 
the San Francisco Police Department with the San Francisco Redevelopment Agency for the continued use of 
Building 606 at the Hunters Point Naval Shipyard and adding thereto certain adjacent property for use as a 
helicopter landing pad. (Real Estate Department) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Tony DeLucchi, Real Estate Department; 
Captain Hettrick, Police Department. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 
990246 [Appropriation, Dept. of Public Works] 

Ordinance appropriating and certifying $87,267, Department of Public Works, for a capital improvement 
project (Ashbury water storage tank) to cover ten percent (10%) overage as per Charter Section 7.203, 
providing for ratification of action previously taken, for fiscal year 1998-1999. (Controller) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Patrick Rivera, Department of Public Works. 

Amended to correct amount of appropriation from "$87,267" to "$89,967"; new title. 

AMENDED. 

Ordinance appropriating and certifying $89,967, Department of Public Works, for a capital improvement 
project (Ashbury water storage tank) to cover ten percent (10%) overage as per Charter Section 7.203, 
providing for ratification of action previously taken, for fiscal year 1998-1999. (Controller) 

RECOMMENDED AS AMENDED by the following vote: 
Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990256 [Lease Amendment! 

Resolution authorizing a second amendment of a 40-year lease of Public Utilities land located in the City of 
Santa Clara for parking and landscaping to MELP VII L.P., lessee. (Public Utilities Commission) 

2/1 1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Haney Rose, Budget Analyst; Gary Dowd. Public Utilities Commission. 
Supervisor Ammiano; Richard Holmstrom, MELP VII L.P. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 3:54 PM on 3/10/99 



Finance and Labor Committee 



Meeting Minutes 



March 10, 1999 



990271 [MOU, Electrical Workers, Local 6] 

Ordinance implementing the provisions of an amendment to Article V.H. of the Memorandum of 
Understanding between the International Brotherhood of Electrical Workers, Local 6, and the City and County 
of San Francisco for an Employee Assistance Program through the expiration of the Memorandum of 
Understanding in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990272 [MOU, Stationary Engineers, Local 39] 

Ordinance implementing the provisions of an amendment to Article V.l. of the Memorandum of 
Understanding between the Stationary Engineers, Local 39, and the City and County of San Francisco 
providing for an Employee Assistance Program through the expiration of the Memorandum of Understanding 
in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990273 [MOU, Teamsters, Local 216) 

Ordinance implementing the provisions of an amendment to Article IV. F. of the Memorandum of 
Understanding between the Building Material and Construction Teamsters, Local 216 and the City and County 
of San Francisco providing for an Employee Assistance Program through the expiration of the Memorandum 
of Understanding in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990274 [MOU, Transport Workers Union, Local 250A (7410)] 

Ordinance implementing the provisions of an amendment to Article IV of the Memorandum of Understanding 
between the Transport Workers Union of America, AFL-CIO and the Transport Workers of America, Local 
250A (7410 Automotive Service Workers), and the City and County of San Francisco providing for an 
Employee Assistance Program through the expiration of the Memorandum of Understanding in 2001. 
(Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 3:54 PM on 3/10/99 



I J 



Finance and Labor Committee 



Meeting Minutes 



March 10, 1999 



990276 [MOU, Transport Workers Union, Local 250A (9163)] 

Ordinance implementing the provisions of an amendment to Section 19 (Drug Treatment) of the Memorandum 
of Understanding between the Transport Workers Union of America, AFL-CIO and the Transport Workers of 
America, Local 250A (9163 Transit Operators and Related Trainee Classifications), and the City and County 
of San Francisco providing for an Employee Assistance Program through the expiration of the Memorandum 
of Understanding in 200 1 . (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990277 [MOU, Laborers Union, Local 261 ] 

Ordinance implementing the provisions of an amendment to Article IV. E. of the Memorandum of 
Understanding between the Laborers Union, Local 26 1 and the City and County of San Francisco providing 
for an Employee Assistance Program through the expiration of the Memorandum of Understanding in 2001. 
(Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990278 [MOU, Glaziers and Glass Workers, Local 718] 

Ordinance implementing the provisions of an amendment to Article IV. G of the Memorandum of 
Understanding between the Glaziers and Glass Workers, Local 7 1 8, and the City and County of San Francisco 
providing for an Employee Assistance Program through the expiration of the Memorandum of Understanding 
in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990279 [MOU, Automotive Mechanics, Local 1414] 

Ordinance implementing the provisions of an amendment to Article IV. J of the Memorandum of 
Understanding between the Automotive Mechanics Union Lodge No. 1414, and the City and County of San 
Francisco providing for an Employee Assistance Program through the expiration of the Memorandum of 
Understanding in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

ADJOURNMENT 

The meeting adjourned at 10:40 a.m. 



City and County of San Francisco 



Printed at 3:54 PM on 3/10/99 



Public Library,Gov't Info. Ctr., 5 th Fir. 
Attn: Susan Horn 



kzZH- 



M 



CITY AND COUNTY 




of san franciscOOCUMENTS DEPT. 



MAR 1 1999 
BOARD OF SUPERVISORS 

SAN FRANCISCO 

PUBLIC LIBRARY 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



BUDGET ANALYST 



March 5, 1999 
TO: ^Finance and Labor Committee 

FROM: ^Budget Analyst 

SUBJECT: March 10, 1999 Finance and Labor Committee Meeting 
Item 1 - File 98-1443 



Department: 
Item: 



Description: 



Police Department 

Ordinance amending Article 1, Chapter VIII, Part II of 
the San Francisco Municipal Code (Police Code) by (1) 
amending Sections 2.26.1 and 2.27.1, to adjust permit and 
license fees for the operation of motor vehicles for hire 
and to provide a 50 percent discount for four years on 
permit fees for taxicabs and ramped taxicabs operating on 
compressed natural gas; and amending Article 16, 
Divisions I and II; (2) amending Sections 1080 and 1088, 
to require approval for fees in these sections from the 
Board of Supervisors; and, (3) amending Section 1125, to 
include the existing fees for taxicab color scheme permits 
and the proposed fee for taxicab color scheme renewals 
(authorized by these sections) in the permit and license 
fee schedules for motor vehicles for hire. 

Section 2.26.1 of the Police Code currently imposes 11 
types of filing fees specifically related to applications for 
Motor Vehicle for Hire permits, which range from a 
permit application filing fee of $53 for a jitney bus driver 
to a permit application filing fee of $347 for a taxicab 
radio dispatch service. Such permit application filing fees 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



are collected on a one-time basis by the Police 
Department. 

The proposed ordinance would (1) increase the permit 
application filing fees for five of the 1 1 Motor Vehicle for 
Hire permits and (2) transfer four filing fees from a list of 
fees charged directly by the Police Commission to the 
schedule of filing fees for Motor Vehicle for Hire permits 
in the Police Code. Attachment I, provided by Officer 
Farrell Suslow of the Police Department, contains the list 
of existing filing fees, the proposed filing fee increases, the 
proposed fee transfers and the dollar and percentage 
increases for each proposed fee change. 

Permit application filing fees are designed to cover the 
cost of all administrative and investigative work of the 
Police Department and other City departments, including 
the Fire Department (SFFD), Department of Public 
Health (DPH), the Department of Parking and Traffic 
(DPT), and the Department of City Planing (DCP), for 
processing permit applications, whether or not the 
permits are ultimately granted. The costs of these 
departments are included in the permit application filing 
fee charged by the Police Department. The fees are 
collected by the Police Department and the fee proceeds 
are allocated to the departments that provide services 
related to processing the specific type of permit 
application for which the filing fee was collected. 

Officer Suslow reports that permit application filing fees 
were last increased in June of 1996 (File No. 121-96-7). 
According to Officer Suslow, since this last fee increase, 
the Police Department placed additional emphasis on 
investigations of existing Motor Vehicle for Hire permits 
and thus, hired four full-time Police personnel between 
October of 1996 and June of 1998 to aide in such 
investigations. Attachment II is a letter, provided by 
Officer Suslow, explaining the Police Department's need 
to increase fifing fees in order to cover the cost of 
increased Police staff already in place. 

Approval of the proposed ordinance would also amend 
Section 2.26.1 of the Police Code by adding a provision to 
allow for a 50 percent credit against the permit 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

2 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



application filing fee for each taxicab or ramped taxicab 
operating on compressed natural gas. According to the 
proposed legislation, such credit for compressed natural 
gas vehicles will expire on January 1, 2003. 

Section 2.27.1 of the Police Code currently imposes 10 
types of annual license fees specifically related to Motor 
Vehicle for Hire permits, which range from $29 per year 
for a public passenger vehicle driver to $346 for a taxicab 
radio dispatch service. Such annual license fees are 
payable to the Tax Collector for permits issued by the 
Police Department. 

The proposed ordinance would (1) increase the annual 
license fees for four of the 10 Motor Vehicle for Hire 
permits and (2) add one new annual license fee to the 
schedule of Motor Vehicle for Hire permits. Attachment I, 
provided by Officer Suslow, contains the existing license 
fees, the proposed license fee increases, the new license 
fee and the dollar and percentage increases for each 
proposed fee change. 

As with permit application filing fees, annual license fees 
are designed to cover the cost of administrative and 
investigative work of the Police Department and other 
City departments, necessary to administer the licensing 
program. Officer Suslow advises that such costs are 
primarily incurred by the Police Department. 

Officer Suslow reports that annual license fees were last 
increased in June of 1996 (File No. 121-96-7). According 
to Officer Suslow, as with permit application filing fees, 
the increased revenues from the proposed annual license 
fees and from the additional license fee for the renewal of 
a taxicab color scheme would be used to cover the cost of 
four full-time Police Department personnel hired between 
October of 1996 and June of 1998 to assist primarily in 
investigations of Motor Vehicle for Hire permits. 

Approval of the proposed ordinance would also amend 
Section 2.27.1 of the Police Code by (1) increasing the 
amount of a credit (from $208 to $220) allowed against 
the license fee for each licensed taxicab operator who 
agrees to participate on a daily basis throughout the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

3 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



permit year in the Paratransit Program and (2) adding a 
provision to allow for a 50 percent credit against the filing 
fee for each taxicab or ramped taxicab operating on 
compressed natural gas. According to the proposed 
legislation, such credit for compressed natural gas 
vehicles will expire on January 1, 2003. 

Section 1080 of the Police Code authorizes the Police 
Commission to set permit application filing fees for the 
operation of motor vehicles for hire. Such fees are used by 
the Police Department and other City departments to 
cover the costs of investigating and processing the 
application for each permit. 

The proposed ordinance would amend Section 1080 of the 
Police Code to provide that such fees for Motor Vehicle for 
Hire permits be approved by the Board of Supervisors (see 
Comment No 1). 

Section 1088 of the Police Code requires the Police 
Department to issue a metallic medallion for each Motor 
Vehicle for Hire permit issued by the Police Department. 
During all hours of operation of a motor vehicle for hire, 
the medallion must be placed in the lower right hand 
corner of the windshield in such a manner that the serial 
number is clearly visible from the exterior of the vehicle. 
Presently, the fee for a metallic medallion is paid once 
each calendar year in an amount determined annually by 
the Police Commission. Such fee is payable to the Police 
Department to cover the costs of producing and processing 
each metallic medallion. 

The proposed ordinance would amend Section 1088 of the 
Police Code to provide that such fees for the metallic 
medallions be approved by the Board of Supervisors. 

Section 1125 of the Police Code requires that upon the 
issuance of a taxicab permit by the Police Department, 
every 7 taxicab permittee is required either to adopt an 
existing taxicab color scheme (i.e. join a particular taxicab 
company with exclusive rights to a distinguishing taxicab 
color scheme) or to establish a new taxicab color scheme; 
in which case, the permittee holds exclusive rights to the 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



Comments: 



Recommendations: 



use of such taxicab color scheme. Taxicab color schemes 
in turn require approval from the Chief of Police. 

The proposed ordinance would amend Section 1125 of the 
Police Code to provide that the fees for taxicab color 
scheme permits, as well as the proposed fees for taxicab 
color scheme changes and color scheme renewals, be 
approved by the Board of Supervisors. 

1. Mr. Thomas Owen of the City Attorney's Office advises 
that if the proposed ordinance is approved, the Police 
Code would be amended to include a provision 
authorizing the Board of Supervisors to approve fees 
imposed by the Police Department. Mr. Owens explains 
that the Police Code presently does not reflect the fact 
that the Board of Supervisors is already approving such 
fees for Motor Vehicle for Hire permits in accordance with 
the City's Charter. 

2. The proposed ordinance incorrectly refers to the fee for 
a metallic medallion as a metal medallion. The proposed 
ordinance should be amended to properly identify that 
this fee is for a metallic medallion and not a metal 
medallion. 

3. According to Officer Suslow, the Police Department 
collects approximately $500,000 per year in existing 
permit application filing fees and annual license fees, as 
identified in Attachment I of this report. According to 
Officer Suslow, the revised fees and the one new fee would 
generate estimated additional revenues to the City of 
$500,000 annually. Officer Suslow therefore estimates 
that the Police Department would realize total fee 
revenues of an estimated $1,000,000 annually if the 
proposed ordinance is approved. Attachment III is a 
memo, provided by Officer Suslow, containing the 
estimated annual fee revenue data. 

1. Amend the proposed ordinance by substituting the 
term "metal" medallion with "metallic" medallion in 
accordance with Comment No. 2 of this report. 

2. Approval of the proposed ordinance, as amended, is a 
policy matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

5 



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es'ie/ss 10:35 




Attachemnt -II 
POLICE DEPARTMENT • 

CITY AND COUNTY OF SAN FRANCISCO 



FRED H. LAU 
CHJEF Of paua 



Mr. Gabriel Cabrera 
Budget Analyst Office 
1390 Market St Suite 205 
San Francisco, CA 941 02 



THOMAS I CAHJtL HAU. Of JL5TTC 

aSO BRYANT STOET 
SAN F8ANOSCO, CALIFORNIA Ml 03 



September 18, 1998 



Dear Mr. Cabrera: 

During our September 17, 1998 telephone conversation you requested that 1 send you a 
letter providing information regarding the Board of Supervisors' proposal to change 
permit and licensing fees for the Taxicab Industry. Hopefully, the following responses 
will suffice for your analysis. 

Your first request was for a list of both the existing and proposed fees. Both the existing 
and proposed fees are listed in the draft ordinance. However, I'm sending you a rough 
draft worksheet from last year that also exhibits the fees. 

Primarily you requested an explanation of how the fee changes were calculated. In past 
years fee changes were calculated by simply adding whatever percentage increase was 
attributable to salary and benefit increases. However, since the last fee increase in 1996 
our overall enforcement focus, as well as our staffing level has dramatically changed. In 
particular we have shifted much of our focus for investigations and enforcement by 
placing additional emphasis on investigations relating to "Permit Holders", "Color 
Schemes" and "Radio Dispatch Services". 

The fees currently before the "Board" were derived by calculating our total costs and then 
raising the fees to equal our costs. Certain fee recommendations such as the "Color 
Scheme" and "Radio Dispatch Service" fees are projected to rise disproportionately as 
- part of an effort to allocate costs more accurately to specific functions. Previous fee 
calculations tended to attribute all such costs within the "Permit Holder" fees. 

Overall, the additional revenue generated by this package of fee increases will cover the 
cost of increased staffing already in place. 



Sincerely, 




icer Farrell Suslow 
Tixicab Detail 



09/24/S8 10:14 



t\ L Ldtiiuieu L. X i. i. 




FRED H. LAU 
CHl£f Of POUCI 



POLICE DEPARTMENT 

CITY AND COUNTY OF SAN FRANCISCO 

THOMAS J. CAHU.L HAIL Of JUSTTCZ 

850 BRYANT STRE£T 
SAN fRANClSCO, CALIFORNIA M1Q3 



September 24, 1998 



Mr. Gabriel Cabrera 
Budget Analyst Office 
1390 Market St. Suite 205 
San Francisco, C A 94102 



Dear Mr. Cabrera; 



During our September 22, 1 998 telephone conversation you requested that I send you a 
letter providing information regarding the Board of Supervisors' proposal to change 
permit and licensing fees for the Taxicab Industry. Hopefully, the following responses 
will suffice for your analysis. 

According to projections from the Controller's Office, our revenues from Taxicab Fees 
have been averaging approximately 5500,000 per year for the past few years. The new 
proposed fees would generate slightly over SI, 000,000 per annum. Total costs for 
staffing and expenses will also be at approximately SI, 000,000 per annum. 

The fee proposal includes only one truly new fee, "Color Scheme License Fee". This 
new few should account for approximately 525,000 of the new revenue. All other fees 
are either fees currently in the Police Code or fees being moved to the Police Code from 
the list of fees charged directly be the Police Commission. 



Sincerely, 




jfScer Farrell Suslow 
Taxicab Detail 



Memo to Finance and Labor Committee 
March 10, 1999 Finance and Labor Committee 



Item 2 - File 99-0186 

Department: 

Item: 



Effective Date of 
Lease Amendment: 

Location: 

Purpose of Lease: 

Lessor: 

Lessee: 

No. of Sq. Ft. and 
Rental Rate 
Per Month: 



Airport Commission 

Approving the First Amendment to the Lease of the 
Airmail Field Post Office between the United States Postal 
Service and the City and County of San Francisco, acting 
by and through its Airport Commission. 



July 8, 1998 

San Francisco Airport Airmail Facility (Plot 10B) 

The lease amendment allows the United States Postal 
Service to modernize and expand the Airmail Facility 
located at the Airport. 

City and County of San Francisco 

United States Postal Service (U.S. Postal Service) 



The U.S. Postal Service currently leases Plot 10B, which 
consists of 234,788 square feet (or 5.39 acres) of space at 
the Airport at a rental rate of $0.113577 per square foot per 
month, or approximately $26,666 per month. In addition, 
the U.S. Postal Service currently has a permit (Permit No. 
458) issued by the Airport to use an additional 97,573 
square feet (or 2.24 acres) at the Airport (Plot 11B). Plot 
11B is also rented at a rate of $0.113577 per square foot per 
month, or approximately $11,082 per month. Thus, the 
Airport currently receives a total of approximately $37,748 
per month from the U.S. Postal Service for 332,361 square 
feet (7.63 acres). 

The proposed lease amendment would incorporate the 
97,573 square feet (2.24 acres) currently utilized by the 
U.S. Postal Service under an Airport permit into the 
existing lease. In addition, the U.S. Postal Service is 
requesting an additional 42,691 square feet (0.98 acres) for 
the renovation and expansion of the Airmail Facility. This 
additional 42,691 square feet would also be leased by the 
U.S. Postal Service at the rental rate of $0.113577 square 

BOARD OF SUPERVISORS 
BUDGET.ANALYST 



Memo to Finance and Labor Committee 
March 10, 1999 Finance and Labor Committee 



Annual Rent: 



Term of Lease 
& Right of Renewal: 



Description: 



Comments: 



foot per month or approximately $4,849 per month. The 
.Airport would therefore collect a total of $42,597 per month 
for a total of 375,052 square feet, to be defined as Plot F. 

The Airport currently collects $452,984 per year from the 
U.S. Postal Service, consisting of $320,000 for 234,788 
square feet under the existing lease plus $132,984 for the 
97,573 square feet under the permit. The annual rent 
would increase by approximately $58,185, from $452,984 to 
$511,169 per annum. 



The proposed lease amendment would be effective 
retroactive to July 8, 1998 (See Comment No. 1) through 
August 31, 2002 (approximately 4 years, 2 months). The 
existing lease also contains three options to renew for five 
years each, commencing on September 1, 2002 and 
extending the lease for a period of up to 15 more years 
(through August 31, 2017). 

According to Mr. Robert Rhoades of the Airport, the U.S. 
Postal Service's Airmail Facility at the Airport provides 
postal services to the airlines and the public. The U.S. 
Postal Service seeks to expand the Airmail Facility in an 
effort to modernize and increase airmail capacity due to 
increasing air traffic at the Airport. According to Mr. 
Rhoades, expansion plans, which will greatly increase the 
efficiency of mail handling operations, include 
modernization of equipment, expansion of truck loading 
docks and building modifications. The expansion of the 
facility, estimated by the Airport at a cost of $40 to $50 
million, will be borne by the U.S. Postal Service. 

1. As noted above, the effective date of the amendment to 
the existing lease between the U.S. Postal Service and the 
Airport is July 8, 1998. As such, the proposed resolution 
should be amended to authorize approval of the lease 
amendment retroactive to July 8, 1998. 

2. According to Mr. Rhoades. the proposed rental rate of 
$0.113577 per square foot per month represents the fair 
market rent for this property. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

10 



Memo to Finance and Labor Committee 
March 10, 1999 Finance and Labor Committee 

Recommendation: Amend the proposed resolution to authorize retroactive 
approval of the proposed lease amendment and approve the 
resolution as amended. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

11 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

Item 3 - File 99-0206 



Department: 
Item: 



Airport 

Resolution (a) approving the issuance of up to 
8165,000,000 additional aggregate principal amount of 
San Francisco International Airport Second Series 
Revenue Bonds (the "Revenue Bonds") for the purpose of 
financing or refinancing certain infrastructure 
improvements at San Francisco International Airport; (b) 
approving the issuance of a new letter of credit to replace 
an existing letter of credit which is expiring, in order to 
continue to secure the Airport's previously authorized 
Commercial Paper Program; and, (c) approving a 16- 
month extension of the Airport's authorization to issue up 
to $400,000,000 in Airport Revenue Refunding Bonds (the 
"Refunding Bonds") previously authorized b\ r the Board of 
Supervisors. 



Amount: 



Not to exceed $165,000,000 in additional Revenue Bonds. 



Source of Funds: 



San Francisco International Airport Second Series 
Revenue Bonds. 



Description: 



Additional Revenue Bond Authorization 

Section 4.115 of the Charter grants the Airport 
Commission (the "Airport") the authority to issue 
Revenue Bonds for Airport-related purposes, subject to 
the approval of the Board of Supervisors. Section 2.62 of 
the Administrative Code provides that such revenue 
bonds shall bear a rate of interest not to exceed that rate 
which may be set by the Airport, subject to the approval 
of the Board of Supervisors. The Airport has set a not-to- 
exceed interest rate of 12 percent in accordance with 
State bond regulations. 

The proposed resolution would authorize up to 
$165,000,000 in new Revenue Bonds for the purpose of: 
(1) financing and refinancing the construction, 
acquisition, equipping and development of infrastructure 
projects of the Airport for projects separate from Master 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 



Plan Projects (the "Infrastructure Projects"); (2) funding 
debt service reserves; and, (3) paying costs of issuance, 
including redemption premiums, and other related costs. 
Mr. Marcus Perro, Executive Financial Officer of the 
Airport, advises that these capital improvements are a 
part of the Airport Infrastructure Improvement Program 
and are not a part of the Airport's Master Plan. 
According to Mr. Perro. the Master Plan is a separate 
subset of the Airport's Five Year Capital Project Plan. 
The Capital Project Plan also includes the Airport 
Infrastructure Improvement Program and the 
Modernization and Revovation Program (all projects 
under the Modernization and Renovation Program were 
completed in 1981). The Board of Supervisors previously 
authorized the Airport to issue $220,000,000 in Revenue 
Bonds for Infrastructure Projects. With the proposed 
additional authorized amount, the total authorized 
amount of Revenue Bonds would be $385,000,000. 

According to Mr. Perro, the proceeds of the proposed 
additional Revenue Bonds would be expended as follows: 

North Terminal Renovation Program $ 40.500.000 
Expansion of International Terminal 

Concession Facilities 41.600,000 
New North International Terminal Garage 37,500,000 

Aviation Archives Project 4.000,000 

Financing Costs* 41.400.000 

Total $165,000,000 

* Financing costs includes $18,500,000 in costs of issuance 
(providing for a debt service reserve fund, underwriter's 
discount, and fees for financial advisors, bond counsel, rating 
agencies and financial printers) and S22,500,000 in capitalized 
interest (interest costs incurred before a project begins 
producing revenues for payment of debt service, and therefore 
paid from bond proceeds). 

Attachment 1. provided by Mr. Perro, provides a program 
budget for each of the above items, totaling $165,000,000. 

The Airport advises that the total debt service for the 
additional $165,000,000 in Revenue Bonds to be paid over 
a 30-year period would be approximately S340,586,670 
based on an estimated interest rate of 5.5 percent. The 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

13 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 



average estimated annual debt service would be 
approximately $11,352,889. Total interest payments over 
30 years would be $175,586,670. 

Letter of Credit 

The Board of Supervisors previously approved the 
issuance of up to $400,000,000 aggregate principal 
amount of Airport Subordinate Commercial Paper Notes 
("Commercial Paper"), secured by a letter of credit. 
Currently, approximately $161,235,000 in Commercial 
Paper debt is outstanding. The letter of credit for the 
Commercial Paper is due to expire on April 30, 1999. In 
order to maintain the current credit rating on the 
outstanding Commercial Paper, a replacement letter of 
credit must be obtained. 

The proposed Resolution would authorize the Airport to 
enter into a new agreement with Societe Generale, 
providing for the terms and conditions of a letter of credit, 
and providing for the issuance of a replacement letter of 
credit by Societe Generale securing the payment of 
principal and interest on the Commercial Paper through 
April 14, 2002. 

The Airport issued a Request for Proposals (RFP) for a 
replacement letter of credit on November 25, 1998, and 
received two proposals on December 17, 1998. Societe 
Generale quoted the lowest cost in its proposal, 
$784,622.47 per year, and was selected to provide the 
letter of credit. Attachment 2, provided by Mr. Perro, 
contains the amounts proposed by each of the two firms 
that responded to the RFP for the letter of credit. 

Extension of Refunding Bond Authority 

On July 20, 1998, the Board of Supervisors authorized the 
Airport to issue, from time to time, on or before December 
31, 2001, up to $1,400,000,000 in Refunding Bonds, 
pursuant to Resolution No. 583-98, of which $400,000,000 
was in connection with the Airport's Commercial Paper 
Program. The Refunding Bonds were originally intended 
to refinance, if necessary or desirable in order to effect 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

14 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 



Comment: 



Recommendation: 



debt service savings, any outstanding debt, including 
Commercial Paper debt, on a long-term basis. 

The proposed resolution would extend the authorization 
for issuance of the Refunding Bonds for 16 months, from 
December 31, 2001, to April 30, 2003. Societe Generale 
has requested this extension as a condition of issuing the 
replacement letter of credit. Societe Generale requires 
that the Airport have refunding authority covering the 
entire term of the letter of credit, from April 14, 1999, 
through April 14, 2002, plus an additional 12 months to 
allow for any necessary refunding of Commercial Paper 
debt, to ensure that if the letter of credit is drawn upon, 
the Airport will be able to issue bonds to repay it. 

All expenditures from (a) the proposed $165,000,000 in 
additional Revenue Bonds and (b) the $400,000,000 in 
Refunding Bonds authorized under this resolution, 
including bond issuance costs, would be subject to 
separate appropriation approval by the Board of 
Supervisors. 

Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

15 




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16 



ATTACHMENT 2 
COST COMPARISON FOR LETTER OF CREDIT PROPOSALS 

Proposers Annual Cost 

Societe Generate S 784,622 



Bay erische Landesbank and $ 1 ,062,5 1 

Morgan Guaranty Trust 



17 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

Item 4 - File 99-0237 



Department: 



Police (SFPD) 

San Francisco Redevelopment Agency (SFRA) 

Real Estate 



Item: 



Location: 



Purpose of Sublease: 



Resolution authorizing the Director of Real Estate to 
enter into an amended Sublease on behalf of the SFPD 
with the SFRA, adding an adjacent 3.3 acre parcel for use 
by the SFPD as a helicopter landing pad. 

Building 606 and an adjacent parcel - Hunters Point 
Naval Shipyard. 

Under an existing Sublease between SFRA, as sublessor, 
and SFPD, as sublessee, the following SFPD functions are 
housed at Building 606: 

Special Operations Bureau 
Crime Lab 

Property Control (evidence) 
"Air Marine" Helicopter Unit 

The proposed resolution would authorize the SFPD to 
sublease an additional 3.3-acre parcel (approximately 
143,748 square feet) from SFRA for purposes of 
constructing a helicopter landing pad for the SFPD's 
helicopter unit, consisting of three operational helicopters 
which are not currently used. Additionally, the SFPD has 
four non-operational helicopters used for spare parts. 
Currently there is no helicopter landing pad at the 
Building 606 site and the SFPD is consequently unable to 
use its helicopters. According to Captain Tim Hettrick of 
SFPD, the SFPD has recently completed the necessary- 
environmental impact assessments and hearings 
regarding the proposed landing pad site, and can now 
proceed with construction after securing a lease for the 
site. 



Sublessc 



Sublessee: 



SFRA, which currently leases the Hunters Point Naval 
Shipyard property from the U.S. Department of the Navy 
(Navy). 

SFPD 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

18 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 



Additional Rent per Month 

and per Year payable Monthly Annually 

by SFPD to SFRA: Rent under current 

Sublease $18.000 $216.000 

Changes under proposed amended Sublease: 
Additional Rent 11,100 133,200 

Additional Cost for Common 

Area Maintenance 15,500 186,000 

Additional Cost for Industrial 

Hygienist (Department of 

Pub he Health Work Order) 9,500 114,000 

Credit for Police Security Services 

($17,517) and Industrial 

Hygienist ($9,500) (27.017) (324.204) 

Net Additional Rent ::• <■-• ?l"V'.'f. 

Net Rent under amended 
Sublease $27,083 $324,996 

The monthly rent under the existing sublease of 90,000 
square feet of warehouse and office space is 
approximately $0.20 per square foot. Annual rent is 
approximately $2.40 per square foot. The proposed 
amended Sublease would add the 3.3 acre helicopter pad 
parcel (unimproved land) to the Sublease for a net 
additional cost of approximately $0,063 per square foot 
per month. Annual rent for the additional parcel is 
approximately $0.76 per square foot for 143,748 
additional square feet. 

The common area maintenance charges are costs imposed 
by the Navy to SFRA. and passed on to SFPD under the 
terms of the amended Sublease. Under the terms of the 
Master Lease between the Navy, as lessor, and SFRA, as 
lessee, the Navy can increase the common area 
maintenance charges whenever its own costs increase, but 
according to Captain Hettrick the Navy will not increase 
such charges for the foreseeable future absent a 
renegotiation of the Master Lease. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

19 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 



According to Captain Hettrick, the $17,517 monthly credit 
for security services is compensation under the amended 
Sublease for the presence of SFPD personnel at Hunters 
Point Naval Shipyard and does not reflect any additional 
SFPD expenditure of funds or staff resources. The 
Industrial Hygienist, for which the SFPD will receive a 
monthly credit of $9,500, is required under an agreement 
between the SFPD and the Police Officer's Association to 
perform testing as long as the property around Building 
606 site contains hazardous waste. 



Escalation of Rent: 



Under the terms of the amended Sublease, the Annual 
Rent payable by the SFPD to the SFRA will continue to be 
increased annually by three percent or the percentage 
change in the Consumer Price Index for the San Francisco 
Bay Area, whichever is greater. 



Utilities and Janitorial 
Services: 



All costs for utilities and janitorial services would 
continue to be the responsibility of the City. 



Term of Amended 
Sublease: 



Right of Renewal: 
Source of Funds: 
Description: 



Approximately April 1, 1999 until June 30, 2002 (39 
months). 

None 

SFPD annual General Fund Budget. 

The SFPD currently subleases Building 606 under a 
Sublease with the San Francisco Redevelopment Agency 
(the "Agency") as previously approved by the Board of 
Supervisors under Resolution No. 317-97. As indicated 
above, the monthly rent under the proposed amended 
Sublease will be $27,083, an increase of $9,083 over the 
existing monthly rent for Building 606. 

According to Captain Hettrick, the cost to construct the 
helipad will be approximately $203,000. Funding for the 
construction of the helipad has been previously approved 
by the Board of Supervisors as a capital improvement 
project in the SFPD FY 1996-97 budget. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

20 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

Comment: According to Jess Myres of the Department of Real 

Estate, the proposed rental rate of $0.76 per square foot 
per year for the additional parcel reflects the lower limit 
of fair market value. 

Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

21 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



Item 5 - File 99-0246 

Department: 

Item: 



Amount: 
Source of Funds: 

Description: 



Department of Public Works (DPW) 

Supplemental appropriation ordinance in the amount of 
$87,267 to fund construction cost overruns, in accordance 
with Charter Section 7.203, associated with the repair 
work to the Auxiliary Water Supply System (AWSS) 
Ashbury Water Storage Tank Project, providing for 
ratification of actions previously taken. 

$87,267 (see Comment No. 2) 

Previously appropriated funds from the sale of 1986 Fire 
Protection Systems Improvement General Obligation 
Bonds 

In November of 1986, San Francisco voters approved 
Proposition A for the issuance of $46.2 million in Fire 
Protection Systems Improvement General Obligation 
Bonds. These bonds were to finance the City's Auxiliary 
Water Supply System (AWSS). The AWSS is a system of 
reservoirs, cisterns, pipelines, pump stations and 
fireboats, used as a water supply source for fire protection 
in emergency situations. 

In 1987, the City sold $31 million of Fire Protection 
Systems Improvement General Obligation Bonds and the 
remaining $15.2 million in 1991 for a total of $46.2 
million. In March of 1996, the Board of Supervisors 
approved a Supplemental Appropriation of $3,907,900 
from accrued interest earned on the Fire Protection 
Systems Improvement Bonds for four types of capital 
improvements: (1) repair and improvement of the 
Fireboat Phoenix, (2) installation of motorized AWSS 
Control Valves, (3) emergency repairs of AWSS facilities, 
and (4) repairs to AWSS Water Storage Tanks, including 
the subject AWSS Ashbury Water Storage Tank. 

According to Mr. Patrick Rivera of the Department of 
Public Works (DPW), in March of 1998, the DPW awarded 
a construction contract, in the amount of $75,000, to 
TRINET Construction, Inc., the low bidder, for the 
replacement of the protective interior lining of the AWSS 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

22 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 

Ashbury Water Storage Tank, located at 1234 Clayton 
Street. According to Mr. Rivera, DPW engineers 
incorrectly recorded the diameter of the tank at 28 feet 
which served as the basis for the bid amount of $75,000 
submitted by TRINET Construction, Inc. During 
construction, TRINET Construction, Inc. discovered that 
the actual diameter of the tank was 56 feet and that 
therefore the actual square footage of work performed by 
TRINET Construction, Inc. on the tank increased by 
5,975 square feet from 3,345 to 9,320 square feet. This 
resulted in a construction cost overrun of $97,467, 
consisting of $89,967 over the original bid amount plus a 
contingency of $7,500, resulting in a total cost of 
$172,467, or approximately 130 percent in excess of the 
actual contract bid amount of $75,000. 

Comments: 1. According to Mr. Rivera, the construction cost overrun 

of $97,467 was already paid by DPW to the contractor 
from (1) previously released 1986 Fire Protection Bond 
monies in the amount of $44,500 and (2) previously 
appropriated 1986 Fire Protection Bond monies and 
interest earnings, in the amount of $52,967, from various 
projects that were completed at less than their estimated 
construction contract amounts. However, because Section 
6.6 of the Administrative Code requires that expenditures 
of more than 10 percent above the estimated amount of 
the contract be authorized by a supplemental 
appropriation, the DPW needs approval by the Board of 
Supervisors of the proposed supplemental appropriation 
ordinance. 

2. The proposed ordinance incorrectly requests $87,267 to 
cover the construction cost overrun associated with the 
repair work to the AWSS Ashbury Water Storage Tank. 
As noted above, the construction cost overrun totaled 
$97,467, consisting of $89,967 over the original bid 
amount plus a contingency of $7,500. According to Mr. 
Randy Parent of the City Attorneys Office, the correct 
amount of this request should be $89,967 because the 
DPW was previously authorized to expend the 
contingency of $7,500 under the terms of the original 
construction contract. Therefore, the proposed ordinance 
should be amended to appropriate the correct amount of 
$89,967, instead of $87,267. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

23 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



Recommendation: In accordance with Comment No. 2 above, amend the 

proposed ordinance to appropriate the correct amount of 
$89,967, instead of $87,267, and approve the proposed 
ordinance as amended. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

24 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

Item 6 - File 99-0256 



Department: 



Item: 



Location: 



Purpose of Lease: 



Public Utilities Commission (PUC) 

Resolution authorizing a second amendment of a 40-year 
lease of PUC land located in the City of Santa Clara for 
parking and landscaping to MELP VII L.P., lessee. 

A portion of Parcel 144 of Bay Division Pipeline Nos. 3 
and 4 right of way, in Santa Clara, California. 

To provide space for parking and landscaping to the 
lessee, MELP VII L.P. 



Lessor: 

Lessee: 

No. of Sq. Ft. and 
Cost Per Month: 



Annual Cost: 

Utilities and Janitor 
Provided by Lessee: 



Term of Lease: 



Right of Renewal: 
Description: 



City and County of San Francisco 
MELP VII L.P. 



The leased parcel is 0.346 acres, or approximately 15,072 
square feet, at a current rate of $1,446.92 per month, or 
approximately $0,096 per square foot. 

The current annual lease rate is $17,363.04. 



The services to the subject land are to be provided bv the 
lessee, MELP VII L.P. 

The term of the existing lease is 40 years, from August 1, 
1977 through July 31, 2017. The proposed second 
amendment would extend the term of the lease by 22 
years, to January 31, 2039. 

None 

The City and County of San Francisco, acting by and 
through the PUC, currently leases approximately 0.346 
acres of land to MELP VII L.P., a Limited Partnership, 
pursuant to a 40-year ground lease currently due to 
terminate on July 31, 2017. The subject City-owned land 
is adjacent to an office building owned by MELP VII L.P. 
and is used for parking and landscaping purposes. On 
July 29, 1998, the Board of Supervisors approved a first 
amendment to the lease under which the then-current 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

25 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

lessee, Larvan properties, assigned the lease to MELP VII 
L.P. and the lease rate was adjusted to its present rate. 

The lessee, MELP VII L.P., has requested that the term of 
the lease be extended for an additional 22 years until 
January 31, 2039. According to Mr. Gary Dowd of the 
PUC, MELP VII L.P. is attempting to obtain replacement, 
long term financing for its adjacent property, and lenders 
are requiring that MELP VII L.P. obtain the subject 22- 
year lease extension from the City. The subject City- 
owned land would continue to be used for parking and 
landscaping purposes. 

In addition to extending the term by an additional 22 
years through January 31, 2039, the proposed second 
amendment to the lease would provide that a rent 
reappraisal by the PUC, which under the existing lease 
terms is scheduled for March 12, 2007, and March 12, 
2012, will also occur on March 12 each fifth year 
thereafter until the termination of the lease. 
Furthermore, when such reappraisals are made, instead 
of providing for a 20 percent discount from fair market 
value for unencumbered land (the value of the land 
absent the utility right of way) at the time of the 
reappraisal as is required under the existing lease, 
effective as of March 12, 2007, the proposed amendment 
to the lease would provide for a 10 percent discount from 
fair market value for the unencumbered land, effective as 
of March 12, 2007. 

The lease will continue to provide that the PUC will 
determine fair market value at the time of reappraisal, 
and that the lessee has the right to challenge the 
reappraisal through various steps, the last of which 
provides that the PUC and the lessee would each select 
its own appraiser and the two appraisals would be 
averaged or, if they differ by more than 10 percent, the 
two appraisers would select a third appraiser who would 
determine which appraisal is closer to fair market value. 

Comments: 1. Mr. Dowd of the PUC states that the property m 

question is of value only to the adjacent property owner, 
which is presently MELP MI L.P. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

26 



Memo to Finance and Labor Committee 
March 10, 1999 Finance Committee Meeting 

2. MELP VII L.P. will continue to pay the existing 
lease rate of $0,096 per square foot per month. According 
to Mr. Dowd, this existing lease rate reflects fair market 
value. 

3. Attached to this report is a memo from Mr. Dowd 
explaining the proposed lease amendment and stating 
that "Staff strongly support the lease proposal." 

Recommendations: Given the fact that the lessee, for his own financing 

reasons, is requesting from the City a 22-year extension of 
an already existing lease, which would otherwise expire 
on July 31, 2017, the Budget Analyst believes that some 
additional consideration from the lessee should be 
obtained by the PUC beyond just granting the lessee a 10 
percent discount from fair market value when the lease 
rate is reappraised instead of a 20 percent discount. 

However, Mr. Dowd points out in his attached 
memorandum that PUC pipeline right of way could never 
be leased at full market value because of the many 
limitations and restrictions placed on its use. 

Therefore, the Budget Analyst considers approval of the 
proposed resolution to be a policy matter for the Board of 
Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

27 



Sent By: CCSF-PUC / UE8; 



415 £54 1877; 



Mar-3-99 11 :50; 




ANN MOLUERCAEN 
FRANKLCOOK 

vice enesioeur 
E. DENNIS NOFtMANJr. 
ROBERT K. WtRSE 
VICTOR G.MAKRAfi 



CITY AND COUNTY OF SAN FRANCISCO 

PUBLIC UTILITIES COMMISSION 



WILLIE L BROWN. JR. u»0» 
ANSON B. MORAN. G&dW- MA/WCC* 



Page 5/8 
Attachment 
Page 1 or 2 



SANFRAMOSCG 
WATER DEPARTMENT 

HE7CH HETCrfr 
WATER AND PCWE.3 

SAmFRANCSCO 
CLEAN WATER PROGRAM 



MFMORANDUM 



TO: Finance and Labor Committee Members 

FROM: Garrett M. Dowd. Director^. $ i 

San Francisco Public Utilities Commission (SFPUC) 



DATE: 



March 3, 1999 



SUBJECT: SECOND AMENDMENT OF A 40-YEAR LEASE OF SFPUC LAND 
LOCATED IN THE CITY OF SANTA CLARA FOR PARKING AND 
LANDSCAPING TO MELP VII L.P., LESSEE 

Recommended Action 

Authorizing Second Amendment of a 40-year Lease of SFPUC Land Located in the City of 
Santa Clara for Parking and Landscaping to MELP VII L.P., Lessee. 



Background 

On February 24. 1998, the SFPUC adopted Resolution 98-0033 approving an AssignmenL 
Assumption and Amendment to Lease from Larvan Properties to MELP VII L.P. At that 
time, MELP VII L.P. agreed to an amendment of Lease to (i) increase the annual rental 
from $2,105.92 to $17,363.00 to reflect Fair Market Value with annual adjustments based 
on any increase of the Consumer Price Index (CPI); (ii) include the Domestic Partners 
Equal Benefits Ordinance; (iii) include the Pesticide Ordinance. 

MELP VII L.P. has now requested a Second Amendment extending the term of the lease 
out forty (40) years from the date of the Second Amendment. This request was made 
based on the lessees desire to obtain certain financing for the adjacent improvement (see 
attached letter of March 2, 1999). On January 25, 1999, the SFPUC adopted Resolution 
99-0026 (attached) approving the Second Amendment to Lease to MELP VII L.P. provided 
the rent reappraisals scheduled for March 12, 2007 and on March 12 each fifth (5*) year 
thereafter will be based on Fee Value less 10% to reflect the SFPUC'a pipeline 
encumbrances on the land multiplied by an appropriate rate cf return. 



BUREAU OF COMMERCliL LAND MANAGEMENT 
1155 MARKET STREET. 5* FLOOR • SAN FRANGSC3 . CALIFORNIA S4103 • (4T51 4*7-6210 



FAX i415i 487-5100 



28 



By: CCSF-PUC / UEB; 415 554 1877; Mar-3-99 11:51; Page 6/8 

Attachment 
Page 2 of 2 



Analysis/Reason fo r Recommendation 

As discussed previously, the lease rate was brought currant at the time of the First 
Amendment of February 1998; therefore, no rent adjustment is required at this time. This 
Second Amendment is advantageous to the City because it offers a guaranteed income 
stream for the next forty (40) years and allows the City to reappraise the rent based on a 
10% discount from Fee Value on March 12, 2007 and every five (5) years thereafter. This 
10% discount is a very aggressive approach to lease valuation in that most utility rights of 
way are valued at between 10% and 50% of Fee Value. In this particular case, the right of 
way is eighty (80) feet wide and no structures can be placed on or near the pipeline. 
These restrictions greatly affect the utility of the land and the SFPUC's ability to lease it yet 
the SFPUC is realizing a lease rate based on 90% of Fee Value. Staff strongly supports 
the lease proposal. 



Fiscal Implications 

None. 



Attachment 



Gloria Young, Clerk of the Beard 
Jill Thompson, SFPUC 



BUREAU OF COMMBpM. LANO MANAGEMENT 
1156 MARKET STREET. 5~ FLOOR • SAN FRANCISCO .-CALIFORNIA *4103 • (415) 487.5210 - FAX (415) 487-520O 

29 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 

Items 7. 8. 9. 10. 11. 12. 13. and 14 - Files 99-0271. 99-0272. 99-0273. 99-0274. 99- 
0276. 99-0277. 99-0278. and 99-0279 

Departments: Department of Human Resources (DHR) 

Department of Public Transportation (Muni) 

Item: File 99-0271 - Ordinance implementing the provisions of 

an amendment to Article V.H of the Memorandum of 
Understanding (MOU) between the International 
Brotherhood of Electrical Workers, Local 6, and the City 
and County of San Francisco, providing for an Employee 
Assistance Program through the expiration of the MOU in 
2001. 

File 99-0272 - Ordinance implementing the provisions of 
an amendment to Article V.I of the MOU between the 
Stationary Engineers, Local 39, and the City and County 
of San Francisco, providing for an Employee Assistance 
Program through the expiration of the MOU in 2001. 

File 99-0273 - Ordinance implementing the provisions of 
an amendment to Article IV. F of the MOU between the 
Building Material and Construction Teamsters, Local 
216, and the City and County of San Francisco, providing 
for an Employee Assistance Program through the 
expiration of the MOU in 2001. 

File 99-0274 - Ordinance implementing the provisions of 
an amendment to Article IV of the MOU between the 
Transport Workers Union of America, AFL-CIO, and the 
Transport Workers of America, Local 250A (7410 
Automotive Service Workers), and the City and County of 
San Francisco, providing for an Employee Assistance 
Program through the expiration of the MOU in 2001. 

File 99-0276 - Ordinance implementing the provisions of 
an amendment to Section 19 (Drug Treatment) of the 
MOU between the Transport Workers Union of America, 
AFL-CIO, and the Transport Workers of America, Local 
250A (9163 Transit Operator and Related Trainee 
Classifications), and the City and County of San 
Francisco, providing for an Employee Assistance Program 
through the expiration of the MOU in 2000. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

30 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 

File 99-0277 - Ordinance implementing the provisions of 
an amendment to Article rV.E of the MOU between the 
Laborers Union, Local 261, and the City and County of 
San Francisco, providing for an Employee Assistance 
Program through the expiration of the MOU in 2001. 

File 99-0278 - Ordinance implementing the provisions of 
an amendment to Article IV. G of the MOU between the 
Glaziers and Glass Workers, Local 718, and the City and 
County of San Francisco, providing for an Employee 
Assistance Program through the expiration of the MOU in 
2001. 

File 99-0279 - Ordinance implementing the provisions of 
an amendment to Article IV. J of the MOU between the 
Automotive Mechanics Union Lodge No. 1414, and the 
City and County of San Francisco, providing for an 
Employee Assistance Program through the expiration of 
the MOU in 2001. 

Description: The Board of Supervisors previously approved legislation 

ratifying MOUs with eight labor organizations which 
represent various Muni employees as follows: 

> International Brotherhood of Electrical Workers, Local 
6 

> Stationary Engineers, Local 39 

> Building Material and Construction Teamsters, Local 
216 

> Transport Workers Union, Local 250A (7410 
Automotive Service Worker) 

> Transport Workers Union, Local 250A (9163 Transit 
Operator and Related Trainee Classifications) 

> Laborers Union, Local 261 

> Glaziers and Glass Workers, Local 718 

> Automotive Mechanics Union Lodge No. 1414 

All eight of these MOUs are currently in effect and expire 
on June 30, 2001, with the exception of the MOU for the 
Transport Workers Union, Local 250A (9163 Transit 
Operator and Related Trainee Classifications), which 
expires on June 30, 2000. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

31 



Memo to Finance and Labor Committee 

March 10, 1999 Finance and Labor Committee Meeting 



Comment: 



The City presently has an Employee Assistance Program 
(EAP) for all City departments, administered by the 
Department of Public Health (DPH). In addition, each of 
the subject eight MOUs cited above required the 
establishment of an EAP within Muni to complement the 
existing federally mandated Substance Abuse Program, 
which requires drug testing for certain classes of Muni 
employees. Muni's Employee Assistance Program is 
designed to assist employees with problems that may 
affect their ability to perform their jobs. Employees who 
participate in Muni's EAP do so on a voluntary basis. 
Muni's EAP is intended to encourage employees to seek 
treatment for substance abuse, family problems, 
depression, stress and other problems, by offering 
employees information, guidance, referrals, counseling 
and follow-up services. Muni's EAP services are provided 
only to certain job classifications of Muni employees who 
are deemed to be "safety-sensitive". 

The proposed ordinances would implement the provisions 
of an amendment to the EAP in each of the eight MOUs. 

Muni has requested that the proposed ordinances be 
continued for one week, to the March 17, 1999 meeting of 
the Finance and Labor Committee, in order to provide 
more information to the Budget Analyst. 



Recommendation: 



cc: Supervisor Yee 

Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 



As requested by Muni, continue the proposed ordinances 
for one week to the March 17, 1999 meeting of the 
Finance and Labor Committee. 




[arvey M. Rose 



Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

32 




City and County of San Francisco 

Meeting Minutes 
^Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Bierman and Tom Ammiano 

V 

Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-4689 



Wednesday, March 17, 1999 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



11 



Members Present: Leland Y. Yee, Tom Ammiano. 



Members Absent: Sue Bierman. 



nOCUMCNTSDfcH, 



Meeting Convened 

The meeting convened at 10:06 a.m. 

REGULAR AGENDA 



MAR 3 1 1999 

SAN FRANCISCO 
D UBLIC LIBRARY 



990243 [Appropriation, District Attorney] 

Ordinance appropriating $1 18,932, District Attorney, of Federal and State Public Assistance to fund the Non 
Custodial Parent (NCP) Project that provides employment and training services to unemployed non custodial 
parents whose children are recipients of public assistance, for the creation of one (1) position for fiscal year 
1998-1999. (Controller) 

(Companion measure to File 990244.) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst ; Edwina Young, Director, Family Support 
Bureau; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990244 [Public Employment 

Ordinance amending Ordinance No. 243-98 (Annual Salary Ordinance, 1998-1999), reflecting the creation of 
one position (Class 8159 Family Support Investigator III), in the District Attorney's Office. (Department of 
Human Resources) 

(Companion measure to File 990243.) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst , Edwina Young, Director, Family Support 
Bureau: Supervisor Ammiano. Amended to make position limited tenure, on line 11, change "N" to "L"; same 
title. 
AMENDED. 

RECOMMENDED AS AMENDED by the following vote: 
Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 4:16 PM on 3/r/99 



Finance and Labor Committee 



Meeting Minutes 



March 17, 1999 



990254 [Reserved Funds, Fire Department] 

Hearing to consider release of reserved funds, Fire Department, (1992 Fire Protection Bond proceeds, 
Ordinance 430-96) in the amount of $300,000, for the purpose of funding the renovation work at Fire Station 
No. 28. (Public Utilities Commission) 

2/1 1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Peter Wong, Department of Public Works. 
APPROVED AND FILED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 
990445 [Grant, Federal Funds, Lead Based Paint Hazard Control Program] Supervisor Bierman 

Resolution authorizing the Mayor (Director, Mayor's Office of Housing) to accept and expend a grant from the 
U.S. Department of Housing and Urban Development for lead-based paint hazard control in a total amount not 
to exceed $3,000,000 which include indirect costs of $30,000. 

3/8/99, RECEIVED AND ASSIGNED to Public Health and Environment Committee. 
3/1 1/99, TRANSFERRED to Fmance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Marsha Rosen, Director, Mayor's Office of 

Housing; Supervisor Ammiano. Amended on page I, lines 5 and 20 to change "$30,000" to "$72,690"; on 

line 19 to reflect that all new positions created under the grant be "Limited Tenure"; new title. 

AMENDED. 

Resolution authorizing the Mayor (Director, Mayor's Office of Housing) to accept and expend a grant from the 

U.S. Department of Housing and Urban Development for lead-based paint hazard control in a total amount not 

to exceed $3,000,000 which include indirect costs of $72,690. 

RECOMMENDED AS AMENDED by the following vote: 
Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990280 [MOU, Transport Workers Union, Local 250A (9163, Part-Time 
Operators] 

Ordinance implementing the provisions of an amendment to Section 16 (benefits for part-time operators) of 
the Memorandum of Understanding between the Transport Workers Union Local 250A (Classification 9163 
and Related Trainee Classifications), to provide a maximum amount of $225 per month toward dependent 
health care coverage for permanent part-tune employees who regularly work a mmimum of twenty hours per 
payroll period and upon completion of one year of continuous service, and to provide that the City will pick up 
the employee's share of contribution to the applicable SFERS retirement plan for permanent part-time 
employees at a rate of: 2.5% following one day to six months of continuous service; 5% following six months 
to one year of continuous service; and 7.5% following one year of continuous service. (Department of Human 
Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: John Ehrlick; Weston Hatch, Municipal Railway. Continued to March 24, 

1999. 

CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 



City and County of San Francisco 



Primed at 4:16 PM on 3/17/99 



Finance and Labor Committee 



Meeting Minutes 



March 17, 1999 



990281 [MOU, Iron Workers, Local 377 (9346)] 

Ordinance implementing the provisions of an amendment to Article 1 1 l.E of the Memorandum of 
Understanding between the International Association of Bridge, Structural Ornamental, Reinforced Iron 
Workers, Riggers and Machinery Movers, Local 377 and the City and County of San Francisco, providing for 
additional compensation for Port employees of the Maintenance Department in Classification 9346 Fusion 
Welder, who are assigned to work in watch-standing, maintenance and/or repair of container cranes for all 
hours actually worked in cranes at the crane site, effective July 1, 1999 through the remaining term of the 
Memorandum of Understanding. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Geoffrey Rothman, Human Resources. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990282 [MOU, Local 21 (9395)] 

Ordinance implementing the provisions of an amendment to the Memorandum of Understanding between the 
International Federation of Professional and Technical Engineers, Local 2 1 , AFL-CIO, and the City and 
County of San Francisco to provide a 6.25% internal adjustment for Class 9395, Assistant Rental Manager for 
the time period beginning July 1, 1999. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Geoffrey Rothman, Human Resources. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990371 [MOU, Local 21] 

Ordinance implementing the provisions of an amendment to the Memorandum of Understanding between the 
International Federation of Professional and Technical Engineers, Local 2 1 , AFL-CIO and the City and 
County of San Francisco to add Appendix B, entitled Schedules of Compensation, for informational purposes, 
and to add Appendix D, entitled Civil Service Provisions; Glossary, pursuant to Section VI. C of the 
Memorandum of Understanding, which provides for modifications by mutual consent of the parties. 
(Department of Human Resources) 

2/24/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Geoffrey Rothman, Human Resources. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990372 [Compensation, Locals 790, 535, 250[ 

Ordinance implementing an agreement adjusting the compensation of certain classifications pursuant to the 
Memorandum of Understanding between the Service Employees International Union, AFL-CIO, Locals 790, 
535, 250 and the City and County of San Francisco, to be effective July 1, 1999. (Department of Human 
Resources) 

2/24/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Geoffrey Rothman, Human Resources, 
Supennsor Ammiano; John Ehrlick. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 4:16 PM on 3/17/99 



Finance and Labor Committee 



Meeting Minutes 



March 17, 1999 



990374 [MOU, Locals 250, 535, 790] 

Ordinance implementing the provisions of an amendment to the Memorandum of Understanding between the 
Service Employees International Union, Locals 250, 535 and 790 and the City and County of San Francisco by 
incorporating Appendix A, which was previously set forth in the Airport's Departmental MOU between SEIU, 
Local 790 and the City and County of San Francisco, and which provides for the Airport to pay the costs of 
additional laboratory tests. (Department of Human Resources) 

2/24/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Geoffrey Rothman, Human Resources. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990410 [Unrepresented Employees Compensation, Fiscal Year 1999-2000) Mayor 

Ordinance fixing compensation for persons employed by the City and County of San Francisco whose 
compensations are subject to the provisions of Section A8.409 of the Charter, in classes not represented by an 
employee organization, and establishing working schedules and conditions of employment and methods of 
payment, effective July 1, 1999. 

(Fiscal impact.) 

3/1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Continued to March 24, 1999. 
CONTINUED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

ADJOURNMENT 

The meeting adjourned at 10:38 a.m. 



City and County of San Francisco 



Primed at 4:16 PM on 3/1^/99 




City and County of San Francisco 

Meeting Minutes 

.Finance and Labor Committee 

Members: Supervisors I eland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102^689 



Thursday, March 18, 1999 



6:00 PM 
Special Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Tom Ammiano. 
Members Absent: Sue Bierman. 



DOCUMENTS DEPT. 
MM 2 3 1999 



Meeting Convened 

The meeting convened at 6:04 P.M. 

REGULAR AGENDA 



SAN FRANCISCO 
p UBLIC LIBRARY 



990252 [Living Wage Ordinance] Supervisors Ammiano, Bierman 

Hearing to consider the need for a living wage ordinance and what kind of living wage ordinance would be 
best for the City and County of San Francisco. 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

3/6/99, CONTINUED. Heard in Committee. Speakers: Father Peter Sammon; Nettie Ceasar; Danny Elvena; 
Bernadine Emperodor; Gaith Gandy, People Organized for Employment Rights (POWER); Martina Gills; 
Josie Moonie; Bob Planthold; Nancy Lewis, RN; Lucille Flato; Khilil Ali; Lester Martin; Darriel Loggins; 
Arthur Campagna; Hank; Robert Boileau; Jim Illig; Pat Breslin; Shirlley Bierly, Council for Older Americans; 
David Novogrodsky; Julia Lopez; Sam Sui; Garrett Jenkins; Frederick Hobson; Milissa Bowen; Mikki Ellis; 
Stan Thomson, POWER; Raymond Liu; Walter Johnson, S.F. Labor Council; Rand Quinn, Coalition for 
Immigrant Rights; Richard Klinke; Jonathan Beauer; Charles Andrew; Ricardo Brooks Alba; Richard Ow; 
Dorothy James; Ed Williard; Marvin Warren; Fred Pecker; Dennis Kelly; Tim West; Denise D'Anne; Dawn 
Moore; Alma Santana; Criss Romero, Harvey Milk Democratic Club; Bill Price, President Senior Action 
Network; Erlinda Villa; Anna Sanchez; Richard Leung; Kent Mitchell; Jonathan Perez; Steven Curria; 
Margaret Hanlon-Gradie. Supervisor Bierman added as cosponsor. Continued to March 18, 1999. 

Heard in Committee. Speakers: Rosie Byers, Homecare Worker; Ana Maria Loya. Director. LaRaza Centro 
Legal; Gary Atienza, Security Guard; Eric Mar, Director, Northern California Coalition for Immigrant 
Rights; Anuradha Mittal, Policy Director, Food First; Laura Trupin, UCSF; Steve Collier, Tenderloin 
Housing Clinic; Tom Van Dyke; Managing Director of Investments, U.S. Bank/Piper Jaffray; Dr Rajiv 
Bhatia, Division of Population Health and Prevention, Department of Public Health; Bob Cnv; Catherine 
Raza, Homecare Workers; Deirdre Keane, Full-time Student; Drica Schoenberger, John Hopkins; Mark 
Gleason, Mario Flores; Vera Haile, In-Home Supportive Services; Tim West, Local 1877; Bruce Allison. 
Disabled; Kay Walker, SEIU; David Giesen; Erin McClary; Conny Ford; Marylouise Lovett, Women's Forum; 
Mikki Ellis; Ron Dicks, Local 21; Wade Hudson; Blair Fuller, Writer; Elva Cross-Garrett, Local 535; Howard 
Williams, Bike Messenger; Cleve Farondi; Juan Flores; Erin Morra; Mr. Verrt, Taxicab Workers Union; 
Mrya Lopez; Mike Doolin, Rental Car Employee; Chris Romero, Harvey Milk Democratic Club ; Christine 
Gaddi, Student Union 205, City College of San Francisco; Rosana Majica; Bob Ulreich. Museum of Modern 
Art; Robert O'Malley; Elveta Stewart; Yolanda Catzalco; Elizabeth Boardman, Adult Day Health Center; 
Sally Buchman; Rita Graffs, Taxicab Driver; Eduardo Capillong, Louis Fiarnmetta; Reg O'Hare; Michael 
Butler; Security Guard; Daisy, Exoic Dancer's Alliance, Larry Edmund; Jason Broom. 
CONTINUED TO CALL OF THE CHAIR by the lollowing vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 11:01 AM on 1/22M9 



Finance and Labor Commiltet 



Meeting Wnutet Hank '* l<m 



ADJOURNMENT 

The meeting adjourned at 8.08 P.M. 



City and County of San Francisco 






Printed at 11:0! AM or, 3/13/91 




City and County of £an Francisco 

Meeting Minutes 
^Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Merman and Tom Aminiano 
Clerk: Man Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-4689 



Wednesday, March 24, 1999 



10:00 AM 
Regular Meeting 



City Hall, Room 263 



h 



Members Present: Leland Y. Yee, Tom Ammiano. 
Members Absent: Sue Bierman. 



Meeting Convened 

The meeting convened at 10:01 a.m. 

REGULAR AGENDA 



UUCUMENTS DEPT. 

MAR 3 1 1999 

SAN FRANCISCO 
p UBLIC LIBRARY 

990241 (Appropriation , Sheriff] 

Ordinance appropriating $1,307,516, Sheriffs Department, from the General Fund Reserve and $503,326 from 
salary savings to fund additional staffing at County Jaii #3, add residential substance abuse treatment beds, 
fund increased food service and workers' compensation costs, and providing for the creation of 22 positions 
for fiscal year 1998-1999. (Controller) 

(Fiscal impact; companion measure to File 990242.) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Michael Hennessey. Sheriff; Supervisor Yee; 
Supervisor Ammiano; Ted Lakey. Deputy City Attorney. Amendment of the Whole reflecting Budget Analyst 
recommendations, in addition to making all 19 positions limited tenure. 
AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 

Ordinance appropriating $1,092,766, Sheriffs Department, from the General Fund Reserve and $521,687 from 
salary savings to fund additional staffing at County Jail #3, add residential substance abuse treatment beds, 
fund increased food service and workers' compensation costs, and providing for the creation of 19 positions 
for fiscal year 1998-1999; funding for these positions was the subject of previous budgetaiy denial. 
(Controller) 

(Fiscal impact; companion measure to File 990242.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 9:34 AM on 3/25/99 



Finance and Labor Committee 



Meeting Minutei 



\lar,h 24, 1 '>•>•) 



490242 [Public Employment | 

Ordinance amending Ordinance No 243-98 (Annual Salary Ordinance. 1998-1999). reflecting the cream n ol 
twenty-two (22) positions (Class 8304 Deputy Sheriff) in the Sheriffs < )ffice I Department of Human 
Resources) 

(Fiscal impact; companion measure to File 99024 1 ) 

2/10/99, RECEIVED AND \SSI< iNED to Finance and Labor Committee 

Heard in Committee Speakers Harvey Rose, Budget Analyst; Michael Hennessey Sheriff Superv isot ■ 
Supervisor Ammiano, TedLakey, Deputy City Attorney intended to alio* for the creation of 19 Imbed 

tenure positions, new title 
AMENDED. 

Ordinance amending Ordinance No. 243-98 (Annual Salary Ordinance. 1998-1999), reflecting the creation of 
nineteen positions (Class 8304 Deputy Sheriff) in the Sheriffs Office. (Department of Human Resources) 

(Fiscal impact; companion measure to File 99024 1 i 

RECOMMENDED \s AMENDED b) the following \ote: 

Ayes: 2 - Yee. Ammiano 

Absent: 1 - Bierman 
990365 [Contract Award Extension | 

Resolution approving Contract Modification No 2 and granting extension of time tor completion of Hetch 
Hetchy Contract No HH-859, Moccasin-Newark rransmission Line lower Painting, Phase II (Public Utilities 
Commission) 

2 23 99, R! CEIVED AND VSSS rNED to Finance and Labor Committee 

Heard in Committee. Speakers Harvey R Public Utilities CommL 

Amended to delete referent e to the Board oj Supervisors approving the ■ > completion of 

Hi tch Hett hy contract No. HH-859. new tide. 

AMENDED. 

Resolution approving Contract Modification No 2. Moccasin-Newark i ransmission Line Lower Painting. 

Phase II. (Public Utilities c ommission) 

RECOMMENDED US AMENDED b) the following vote: 
Ayes 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990359 [Children's Services Plan. 1999-2000| Mays* 

Resolution approving the Children's Services Plan ( 1999-2000) for the San Francisco Children's Fund 

2 22 99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3 24 1999. 

Heard in Committee Speakers Harvey Rose, Budget Analyst; Deborah Alvarez-Rodriguez. Director, 
Department of Children. Youth & Their Families (DCYF); Supervisor Yee. Supervisor Ammiano In Support. 
Norma Telson. Philipino American (. ouncd; Robert Gomez Glide Memorial Church, Michael Funk. Director. 
Sunset Neighborhood Beacon Center; Marie Ciepiela. Director OMl/Excelsior Neighborhood Beacon. ,'. 
Brackenridge, Jamestown Community Center; Robert L hrle. Samoan Community Development Center; 
Mitchell Sallazar, RAP Mission District. John Osaki. Japanese Youth Council; Jim Richards. Columbia Pa r k 
Boys <£ Girls Club; Mindy Linetsky. Amended to require that on or about July 15. 1999. the Department oj 
Children. Youth and Their Families submit a detailed budget supporting the $700,000 allocation for 
evaluation services, including the identification of all outside consultants and nonprofit agencies, the amount 
allocated to each specific organization and the estimated hours of service to be provided and the average 
hourly rates to be charged by each organization; same title 
AMENDED. 



City and County of San Francisco 



Printed at 9:34 A W on i 25 «« 



Finance and Labor Committee 



Meeting Minutes 



March 24, 1999 



RECOMMENDED AS AMENDED b> the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990272 [MOl . Stationary Engineers. Local 39] 

Ordinance implementing the provisions of an amendment to Article V.l. of the Memorandum of 
Understanding between the Stationary Engineers, Local 39, and the City and County of San Francisco 
providing for an Employee Assistance Program through the expiration of the Memorandum of Understanding 
in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
3/10/99, CONTINUED. Continued to March 24, 1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Alice Villagomez, Department of Human 
Resources; Ray Antonio, Transport Workers Union; Don Vincent. Local 39; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990271 [MOU, Electrical Workers, Local 6| 

Ordinance implementing the provisions of an amendment to Article V.H. of the Memorandum of 
Understanding between the International Brotherhood of Electrical Workers, Local 6, and the City and County 
of San Francisco for an Employee Assistance Program through the expiration of the Memorandum of 
Understanding in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
3/10/99, CONTINUED. Continued to March 24, 1999. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Alice Villagomez. Department of Human 
Resources; Ray Antonio. Transport Workers Union; Don Vincent, Local 39; Supervisor Ammiano 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990273 [MOU. Teamsters. Local 2)6] 

Ordinance implementing the provisions of an amendment to Article IV. F. of the Memorandum of 
Understanding between the Building Material and Construction Teamsters. Local 216 and the City and County 
of San Francisco providing for an Employe Assistance Program through the expiration of the Memorandum 
of Understanding in 2001. (Department of Human Resources) 

2/ 17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
3/10/99. CONTINUED. Continued to March 24. 1999. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Alice Villagomez. Department of Human 
Resources; Ray Antonio. Transport Workers Union; Don Vincent. Local 39. Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 9 -.34 AM on 3 7S VQ 



Finance and Labor Committt 



Meeting Minutes 



\4art ii 24. I ')•)') 



990274 |MOl', Transport Workers Union, Local 250A (7-4l())| 

Ordinance implementing (he provisions "I an amendment to Article IV of die Memorandum ofl nderstanding 
between the Transport Workers I nion of America, All -( IO and the I ransport Workers of America. I 
250A (7410 Automotive Service Workers), and the < it> and ( bunt) >>t "san I rancisco providing for an 
I mployee Assistance Program through the expiration of the Memorandum ofl nderstanding in 2001 
(Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 
3/10/99, CONTINUED. Continued to March 24, 1999. 

Heard in Committee Speakers Harvey Rose. Budget Analyst, Alice VUlagomez, Department of Human 
Resources, Rii\ Antonio, Transport Workers l num. Don Vincent, Local 39, Supervisor Ammiano 
RECOMMENDED by the following vote: 

Ayes. 2 - Yee, Ammiano 
Absent: 1 - Bierman 

990276 |MOl', Transport Workers I nion. Local 250A (9163)] 

Ordinance implementing the provisions of an amendment to Section 19 (Drug Treatment) of the Memorandum 
of Understanding between the Transport W orkers Union of America \l I ( l< > ami the Iransport Workers of 
America, Local 2S0A (9163 I iansit Operators and Related Trainee Classifications), and the City and County 
of San Francisco pro\ iding lor an Employee Assistance Program through the expiration of the Memorandum 
of Understanding in 2001 (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and I abor ( ommittee 
3 10/99, CONTINUED Continued to March 24, 1999. 

Heard in Committee. Speakers Harvey Rose, Budget Analyst Alice Villa*. • : oj Human 

Resources, Ra\ 4ntonu>. Transport R m, Don Vincent, i l Ammiano 

RECOMMENDED by the following Note: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 • Bierman 

990277 [MOU, Laborers Union, Local 2bl | 

Ordinance implementing the provisions of an amendment to Article IV 1- of the Memorandum of 
I nderstanding between the laborers Union. Local 261 and the City and I San Francisco providing 

for an Employee Assistance Program through the expiration of the Memorandum ol I nderstanding in 2001 
(Department of Human Resouiccs) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 
3/10/99, CONTINUED. Continued to March 24. 1999. 

Heard in Committee. Speakers Harvey Rose, Budget Analyst. Alice Villagomez, Department of Human 
Resources; Ray Antonio. Transport Workers Union, Dor. Vim r Ammiano 

RECOMMENDED by the following vote: 

Ayes: 2 - Yee. Ammiano 
Absent: 1 - Bierman 



City and County of San Francisco 



Primed at 9:34 4. W on 3J1SA9 



Finance and Labor Committee 



Meeting Minutes 



March 24. 1999 



990278 |MOU, Glaziers and Glass Workers, Local 718| 

Ordinance implementing the provisions of an amendment to Article IV.G of the Memorandum of 
Understanding between the Glaziers and Glass Workers, Local 718, and the City and County of San Francisco 
providing for an Employee Assistance Program through the expiration of the Memorandum of Understanding 
in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
3/10/99, CONTINUED. Continued to March 24, 1999. 

Heard in Committee. Speakers: Han>ey Rose, Budget Analyst; Alice Villagomez, Department of Human 
Resources; Ray Antonio, Transport Workers Union; Don Vincent, Local 39; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990279 |MOU, Automotive Mechanics, Local 1414] 

Ordinance implementing the provisions of an amendment to Article IV. J of the Memorandum of 
Understanding between the Automotive Mechanics Union Lodge No. 1414, and the City and County of San 
Francisco providing for an Employee Assistance Program through the expiration of the Memorandum of 
Understanding in 2001. (Department of Human Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
3/10/99, CONTINUED. Continued to March 24. 1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Alice Villagomez, Department of Human 
Resources; Ray Antonio, Transport Workers Union; Dun Vincent, Local 39; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990373 [MOU. Local 790! 

Ordinance implementing the provisions of an amendment to Section 32 of the Memorandum of Understanding 
between the Sen/ice Employees International Union, Local 790 and the City and County of San Francisco 
providing for an Employee Assistance Program through the expiration of the Memorandum of Understanding 
in 2000. (Department of Human Resources) 

2/24/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Haney Rose, Budget Analyst; Alice Villagomez, Department of Human 
Resources; Ray Antonio, Transport Workers Union; Don Vincent, Local 39; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

9903 1 7 |MOU, Transport Workers Union, Local 2001 

Ordinance implementing the provisions of an amendment to Article IV of the Memorandum of Understanding 
between the Transport Workers Union of America, AFL-CIO and the Transport Workers of America, Local 
200, and the City and County of San Francisco providing for an Employee Assistance Program through the 
expiration of the Memorandum of Understanding in 2001. (Department of Human Resources) 

2/23/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Haney Rose, Budget Analyst; Alice Villagomez, Department of Human 
Resources; Ray Antonio, Transport Workers Union; Don Vincent, Local 39; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 



City and County of San Francisco 



Printed at 9:35 AM on 3/25/99 



/ inum e and Labor Committee Meeting Minutes March 24, 1999 

990280 [MOU, Transport Workers Union, local 250 A (91fi3, I'ari- 1 imi 
Operators) 
Ordinance implementing the provisions of an amendment to Section 16 (benefit] lor part-time opera tort) of 

the Memorandum of Understanding between the I ranspoit Workers I nion I ocal 250A (( lassitication 9163 
and Related Trainee Classifications), to pro\ ide a maximum amount of S225 per month toward dependent 
health care coverage for permanent part-time employees who regular!) work J minimum of twent) hours per 
payroll period and upon completion of one year of continuous sen ice, and to pro\ ide that the Cit) will pick up 
the employee's share of contribution to the applicable SI ERS retirement plan for permanent part-time 
employees at a rate of: 2.5% following one day to six months of continuous sen ice. 5% following six months 
to one year of continuous service; and 7.5% following one year of continuous sen ice ( Department of Human 
Resources) 

2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

3/17/99, CONTINUED. Heard in Committee Speakers: John Ehrlick; Weston Hatch. Municipal Rail* 
Continued to March 2-4, 1999 

Hand in Committee Speakers Harvey Rose. Budget Anal] Rothman. Human Resow 

Employee Relations Division 
RECOMMENDED b\ the following vote: 

Ayes: 2 - Yee, Ammiano 

Absent: 1 - Bierman 

990410 (Unrepresented Emplo>ees Compensation, Fiscal Year i , »'» , )-2000| Mayor 

Ordinance fixing compensation for persons employed b) the < it) ami ( ount) ol San ! rancisco whose 
compensations are subject to the provisions of Section A8.409 ol the Charter, in classes not represented by an 
employee organization, and establishing working schedules and conditions of employment and methods of 
payment, effective July 1, 1" 

(Fiscal impact.) 

3 I 99. RECEIN ED AND ASSIGNED to Finance and Labor Committee 

3/17/99, CONTINUED Continued to March 24. 1999. 

Heard in Committee Speakers Harvey Rose. Budget Anal '-. Rothman. Human Resow 

Employe* Relations Division. 
RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Ammiano 
Absent: 1 - Bierman 

ADJOURNMENT 

The meeting adjourned at 12 OS p m 



City and Count)- of San Francisco 6 Primed at 9:35 AM on j 2J v« 






CITY AND COUNTY 




Public Library, Gov't Information Ctr.. 5 th Fir. 
Attn: Susan Horn, Dept. 41 



OF SAN FRANCISCO 



.BOARD OF SUPERVISORS 

BUDGET ANALYST 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



March 19, 1999 
TO: ^Finance and Labor Committee 

FROM: ^Budget Analyst 
SUBJECT: March 24, 1999 Finance and Labor Committee Meeting 

DOCUMENTS DEPT. 



Items 1 and 2 - Files 99-0241 and 99-0242 



Department: 



Items: 



Amount and 
Source of Funds: 



Sheriffs Department 



MAR 2 3 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



Item 1, File 99-0241: Supplemental Appropriation 
Ordinance appropriating $1,307,516 from the General 
Fund Reserve and $503,326 from Excess Attrition 
Savings, for a total of $1,810,842, to fund (a) additional 
staffing at County Jail No. 3, (b) residential substance 
abuse treatment beds, (c) increased food service, and (d) 
workers compensation costs, and providing for the 
creation of 22 new positions for the Sheriffs Department. 

Item 2, File 99-0242: Ordinance amending the 1998-99 
Annual Salary Ordinance to reflect the creation of 22 new 
positions in the Sheriffs Department. 



General Fund Reserve $1,307,516 

Excess Attrition Savings from Fringe Benefits 

in the Sheriff Department's FY 1998-99 

Budget 503.326 

Total Supplemental Appropriation Request $1,810,842 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Budget: The requested budget of $1,810,842, for the period from 

March 1, 1999 through June 30, 1999, is as follows: 

Jones Case Settlement Agreement 



Permanent Salaries 


$64,904 


Fringe Benefits 


20.452 


Total - Jones Case Settlement Agreement 


$85,356 


Expansion of Residential Drug Treatment 




Program 




Professional Services: 




Contracts for 100 Additional Inmate Beds 


$621,600 


Case Management Services 


17.000 


Subtotal - Professional Services 


$638,600 


Personnel: 




Overtime 


$71,946 


Fringe Benefits 


1.169 


Subtotal - Personnel 


$73,115 



Total - Residential Drug Treatment Program 711,715 

Projected Budgetary Shortfalls 

Materials and Supplies - Food Costs $724,559 

Workers Compensation 289,212 

Total - Projected Budgetary Shortfalls $1,013,771 



Total Requested Funds $1,810,842 

Description: The proposed supplemental appropriation ordinance (File 

99-0241) would appropriate $1,307,516 from the General 
Fund Reserve, plus $503,326 from higher than 
anticipated attrition savings in the Sheriffs FY 1998-99 
budget, for a total of $1,810,842, to fund (a) the provisions 
of a proposed settlement agreement in the case Jones v. 
Citv and County of San Francisco, et al. regarding County 
Jail No. 3 (San Bruno Jail); (b) the expansion of the 
Residential Drug Treatment Program in order to reduce 
jail overcrowding; and (c) projected budgetary shortfalls in 
food and workers compensation costs. 

The proposed ordinance (File 99-0242) would amend the 
Annual Salary Ordinance to reflect the creation of 22 new 
positions (1.85 FTE in FY 1998-99), as follows: 

No. of FY 98-99 Biweekly Annual 

Positions FTE Class Title Salary Salary 

22 1.85 8304 Deputy Sheriff $1,603 - $1,946 $41,838 - $50,791 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

2 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



The estimated annual cost of the 22 new positions would 
range from $1,178,158 at Step 1, including salaries of 
$920,436 and fringe benefits of $257,722, to $1,430,275 at 
Step 5, including salaries of $1,117,402 and fringe 
benefits of $312,873. 

Jones Case Settlement Agreement ($85.356) 

In May of 1991, an action was filed against the City 
(Jones v. City and County of San Francisco et al.) 
challenging that the conditions at County Jail No. 3 in 
San Bruno were in violation of constitutional 
requirements. After several years of litigation, a proposed 
settlement agreement has been reached that would result 
in dismissal of the plaintiffs action, so long as certain 
conditions are met by the City. These conditions include 
(a) the construction of a new jail facility; (b) the 
continuance of certain improvements made to County Jail 
No. 3 between July, 1997 and the present; and (c) 
improvements in the conditions at County Jail No. 3 on 
an interim basis, pending completion of a proposed new 
jail facility, estimated to be completed in late 2002. 
According to Ms. Joanne Hoeper of the City Attorney's 
Office, the proposed settlement agreement would not 
obligate the City to construct a replacement jail. Ms. 
Hoeper advises that if the City decided not to proceed 
with the construction of a new jail, the proposed 
settlement agreement would be set aside and the lawsuit 
would proceed. Ms. Hoeper reports that the proposed 
settlement agreement is expected to be submitted for 
approval to the Audit and Government Efficiency 
Committee of the Board of Supervisors at its meeting of 
April 6, 1999. 

Ms. Hoeper further advises that the proposed new jail 
facility would be constructed through a design-build 
process, in which a developer team, consisting of a general 
contractor and an architect-engineer, would design, build 
and finance the new facility. The developer team would 
then lease back the facility to the City over an anticipated 
term of up to 50 years. The City would maintain and 
operate the facility and would pay rent, subject to annual 
appropriation by the Board of Supervisors, to the 
developer team. Funds totaling $3,062,750 have been 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

3 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



appropriated since FY 1996-97 to prepare an 
Environmental Impact Report, prepare specifications and 
criteria packages defining the scope of the project, and 
administer the project. In December, 1998, two of five 
design-build teams that had pre-qualified for the project 
submitted proposals. Ms. Hoeper advises that, because 
the design-build proposals are still under review, the cost 
of constructing and financing the replacement jail is not 
yet known. Ms. Hoeper anticipates that the highest- 
ranking proposal will be submitted to the Board of 
Supervisors for consideration by June 1, 1999. 

The proposed supplemental appropriation ordinance 
would fund the implementation of one of the conditions 
included in the proposed settlement agreement. 
Specifically, the proposed settlement agreement states 
that, by June 30, 1999, the City must hire additional 
Deputy Sheriffs in order to ensure that one Deputy 
Sheriff is assigned to and physically present in each 
dormitory and occupied tier in County Jail No. 3 at all 
times when inmates are present. 1 As such, since County 
Jail No. 3 has 10 dormitories/tiers, all of which are 
currently occupied, there must be at least 10 Deputy 
Sheriffs on duty per eight-hour shift (on the midnight, day 
and swing shifts) to be able to staff each of the 10 
dormitories/tiers on a 24-hour basis. The table below 
shows the current and proposed staffing levels, which, 
according to the Sheriffs Department, are needed to 
comply with the proposed settlement agreement for 
County Jail No. 3. 



Dormitories and tiers are the sections of the jail where inmate cells and beds are located. 
Dormitories are large rooms containing a number of inmate beds, while tiers are divided into 
individual inmate cells. County Jail No. 3 contains two dormitories on the second floor and two 
tiers of cells per floor on four other floors, for a total of two dormitories and eight tiers on five 
floors. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 





Midnight Shift 


Dav Shift 


Swing Shift 


Total 


Current 


Proposed 


Var. 


Current 


Proposed 


Var. 


Current Proposed 


Var. 


Current 


Proposed 


Var. 


No. of Deputies 
Working on Tiers 


2 
7 


11 

7 


9 



8 
15 


10 
14 


2 
(1) 


8 10 
10 10 


2 



18 
32 


31 
31 


13 
(1) 


No. of Deputies 
Assigned to Other 
Duties at Jail #3 


Total 


9 

1.76 


18 
1.76 


9 

1.76 


23 

1.76 


24 
1.76 


1 
1.76 


18 20 
1.76 1.76 


2 
1.76 


50 

1.76 


62 
1.76 


12 
1.76 


Relief Factor* 


Subtotal 


16 

3 


32 
3 


16 



40 

7 


42 
7 


2 



32 35 
3 4 


3 

1 


88 
13 


109 
14 


21 

1 


No. of Supervisors 
Assigned to Jail £3** 


Total Staffing 


19 


35 


16 


47 


49 


2 


35 39 


4 


101 


123 


22 



The relief factor, calculated by the Sheriffs Department, is based on actual attendance and is used to 
determine the number of employees needed to staff a post seven days per week. 

There is no relief factor for supervisors, as the Sheriffs Department does not backfill supervisory positions. 



As shown in the table above, according to the Sheriffs 
Department, an additional 22 positions are needed in 
order to comply with the conditions of the proposed 
settlement agreement. Although the settlement 

agreement does not specify the actual number of Deputy 
Sheriffs required, the proposed supplemental 
appropriation ordinance (File 99-0241) and amendment to 
the Annual Salary Ordinance (File 99-0242) would 
provide for the creation of 22 new 8304 Deputy Sheriff 
positions. Budget details for this $85,356 request are as 
follows, assuming a hiring date of June 1, 1999: 



Permanent Salaries ($1,341 biweekly* 
x 2.2 pay periods x 22 positions) 

Fringe Benefits (31.5 percent) 
Total 



$64,904 

20.452 

$85,356 



This reflects the lower biweekly salary for 8302 Deputy Sheriff I 
positions of $1,341, which is in effect during the first 12 months of 
service. After 12 months, the salary increases to the biweekly rate of 
$1,603 for 8304 Deputy Sheriffs. 



Expansion of Residential Drug Treatment 
Programs (S711.715) 

The proposed supplemental appropriation ordinance (File 
99-0241) includes $711,715 to expand the Sheriffs 
Residential Drug Treatment Program, as follows: (a) 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

5 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



$621,600 to fund an additional 100 inmate beds per day; 
(b) $17,000 for case management services; and (c) $73,115 
for overtime and fringe benefits to provide supervision for 
the program. 

The Sheriffs Department advises that the jail population 
has risen steadily during FY 1998-99, from an average 
monthly population of 1,935 inmates in January, 1998 to 
2,113 inmates in February, 1999. According to Ms. Jean 
Mariani of the Sheriffs Department, this increased prison 
population results in part from an increase in the bail 
schedule on October 1, 1998, which reduced the number of 
prisoners released on bail by approximately 30 percent. 

Of the 2,113 inmates in custody in February, 1999, an 
average of approximately 37 inmates per day were in the 
City's central intake facility. The balance of 2,076 
inmates occupied beds in the County's seven jails. The 
Sheriffs Department reports that the rated capacity (i.e., 
the total number of jail beds) in the seven county jails is 
2,004. Thus, as of February, 1999, there were 72 more 
inmates in the County's jails than there were beds 
available. As a result, according to the Sheriffs 
Department, some inmates must sleep on the floors in 
some of the jails. 

In order to alleviate jail overcrowding, the Sheriffs 
Department has several alternative programs, such as the 
Home Detention and Residential Drug Treatment 
Program. The Sheriffs FY 1998-99 budget includes 
$956,800 in funding to contract for 44 residential drug 
treatment beds per day with six non-profit organizations, 
at an average cost of $60 per day for 365 days. In order to 
alleviate jail overcrowding, the Sheriffs Department is 
now requesting an additional $621,600 to phase in an 
additional 100 residential drug treatment beds, at an 
average cost of $60 per bed per day, between March 1, 
1999 and June 30, 1999, as follows: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

6 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 













Total Cost 




No. of 


No 


of 


Cumulative 


@ $60/ bed' 


Month 


Days 


New Beds No. of Beds 


day 


March 


31 




70 


70 


S 130,200 


April 


30 




10 


80 


S 144,000 


May 


31 




10 


90 


S 167,400 


June 


30 




10 


100 


S 180,000 


Total 










S 621,600 



Therefore, in order to alleviate jail overcrowding, the 
Sheriffs Department advises that it would contract with 
the same six non-profit organizations to contract for the 
additional 100 residential drug treatment beds. 
Attachment I, provided by the Sheriffs Department, 
identifies the six non-profit organizations and the 
amounts to be allocated to each agency. 

The Sheriffs Department is also requesting $17,000 for a 
sole source contract with Haight-Ashbury Free Clinics, a 
non-profit organization that currently provides jail 
psychiatric services to inmates in the City's jails through 
a contract with the Department of Public Health (DPH). 
Mr. Kevin Foster of the Sheriffs Department advises that 
the Sheriffs Department plans to contract directly with 
Haight-Ashbury Free Clinics on a sole source basis to 
provide case management services to inmates who are not 
in the jails but who are participating in the Residential 
Drug Treatment Program. This request of $17,000 would 
provide an estimated 696 hours of service at 
approximately $24 per hour for the period from March 1, 
1999 through June 30, 1999. Mr. Foster advises that the 
contractor could serve approximately 15 percent of the 
inmates in the Residential Drug Treatment Program, or 
about 22 inmates per day (15 percent of the proposed 144 
treatment beds per day). According to Mr. Foster, the 
reason for contracting with Haight-Ashbury Free Clinics 
on a sole source basis without further competitive bidding 
is that Haight-Ashbury Free Clinics, as DPH's existing 
contractor for jail psychiatric services, has expertise in 
providing psychiatric services to prisoners. 

The Sheriff is also requesting $73,115 for overtime and 
fringe benefits for the equivalent of three Deputy Sheriffs 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

7 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



and one Senior Deputy Sheriff (a total of 4.0 FTEs) to 
provide supervision of inmates participating in the 
Residential Drug Treatment Program. A breakdown of 
this request for the period April 8, 1999 through June 30, 
1999 (six pay periods), is as follows: 

Overtime 

Deputy Sheriffs: 1,440 hours (240 hours/ 

pay period for six pay periods) % approx. 

S36.49 per hour $52,542 

Senior Deputy Sheriff: 480 hours (80 hours/ 

pay period for six pay periods) % approx. 

$40.43 per hour 19.404 

Subtotal -Overtime $71,946 

Fringe Benefits (1.625 percent*) 1.169 

Total $73,115 

* The City pays only Medicare and Unemployment Insurance on 
overtime wages. 

Ms. Mariani advises that the Department is requesting 
funds to provide supervision of the Residential Drug 
Treatment Program on an overtime basis because it is 
uncertain at this time whether the Mayor's Office will 
fund the proposed expansion of this program beyond this 
fiscal year. Ms. Mariani advises that Department has 
requested the Mayor's Office include approximately 
$2,447,428 in its FY 1999-00 budget to continue the 
expanded program through FY 1999-00, including (a) 
$2,190,000 for the 100 extra drug treatment beds at $60 
per day for 365 days, (b) $51,000 for the contract with 
Haight-Ashbury Free Clinics, and (c) $206,428 for three 
new Deputy Sheriff positions and one new Senior Deputy 
Sheriff position. 

Projected Budgetary Shortfall in Materials and 
Supplies- Food Costs ($724.559) 

The Sheriffs Department has contracted with Aramark 
Correctional Services since 1980 to provide meals for 
prisoners in the jails. The Sheriffs actual FY 1997-98 
expenditures for food costs were $4,711,439. Based on (a) 
actual expenditures through January 15, 1999 of 
$2,433,972; (b) cost-of-living adjustments in Aramark's 
contract of 3.2 percent (effective August 8, 1998 for the 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

8 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

1997-98 fiscal year 2 ) and 5.4 percent (effective November 
1, 1998 for the 1998-99 fiscal year) and (c) the increased 
prisoner population, from 1,935 inmates in January, 1998 
to 2,113 inmates in February, 1999, the Sheriffs 
Department estimates that total FY 1998-99 expenditures 
for food costs will be $4,850,000, or $724,559 more than 
its FY 1998-99 budget of $4,125,441. Thus, the Sheriff is 
now requesting $724,559 to fund its projected budgetary 
shortfall in food cost expenditures. The Budget Analyst 
has reviewed the Sheriffs actual and projected 
expenditures in Materials and Supplies - Food Costs and 
concurs with the Sheriffs analysis. 

Projected Budgetary Shortfall in Workers 
Compensation ($289.212) 

Based on actual expenditures through December 31, 1998 
of $580,777, less adjustments for one-time costs of 
$16,136, the Workers Compensation Division of the 
Department of Human Resources (DHR) estimates that 
the Sheriffs total FY 1998-99 workers compensation 
expenditures will be $1,129,282. This amount is $289,212 
more than the Sheriffs FY 1998-99 budget for workers 
compensation of $840,070. Thus, the Sheriff is now 
requesting $289,212 to fund a projected budgetary 
shortfall in workers compensation expenditures. The 
Budget Analyst has reviewed the Sheriffs actual and 
projected expenditures in Workers Compensation and 
concurs with the Sheriffs analysis. 

Comments: 1. The proposed supplemental appropriation would be 

funded in part by $503,326 in Excess Attrition Savings 
from Fringe Benefit expenditures in the Sheriffs FY 
1998-99 budget. The Budget Analyst has reviewed the 
Sheriffs most recent fringe benefit expenditure 
projections, as of March 5, 1999. The Sheriff is currently 
projecting a surplus of $521,687 in fringe benefit 
expenditures for FY 1998-99. The Budget Analyst 
concurs with the Sheriffs projections. As such, the 
Budget Analyst recommends (a) increasing the portion of 
the subject request to be funded by Excess Attrition 
Savings in the Sheriffs FY 1998-99 budget by $18,361, 



Ms. Mariani reports that Aramark did not request the FY 1997-98 cost-of-living adjustment 
allowed in its contract until FY 1998-99. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

9 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



from $503,326 to $521,687, and (b) reducing the portion of 
the subject request to be funded by the General Fund 
Reserve by $18,361, from $1,307,516 to $1,289,155. 

2. During the FY 1998-99 budget process, the Sheriffs 
Department requested 22 new Deputy Sheriff positions 
(8.25 FTE for 4.5 months in FY 1998-99) in anticipation of 
a settlement agreement in the Jones case. Based on the 
recommendation of the Budget Analyst, this request for 
22 new positions was denied by the Board of Supervisors, 
because a settlement had not been reached by the parties 
at that time. Therefore, in accordance with 
Administrative Code Section 3.15, the 22 new Deputy 
Sheriff positions that are now being requested would 
require two-thirds approval by the Board of Supervisors 
since the funding for these positions was the subject of 
previous budgetary denial. 

3. The Budget Analyst has evaluated alternatives to 
adding the requested 22 new Deputy Sheriff positions, 
such as consolidating prisoners at Jail No. 3 in San Bruno 
and/or transferring a portion of the prisoners and staff 
from Jail No. 3 to the Naval Brig on Treasure Island. 
However, the Budget Analyst concurs with the Sheriffs 
assessment that these alternatives do not represent 
viable options at this time. 

In October of 1997, the Board of Supervisors approved a 
supplemental appropriation ordinance in the amount of 
$1,699,955 (File 101-97-20) and an amendment to the 
Annual Salary- Ordinance for the creation of 27 new 
positions (File 102-97-6), in order for the Sheriffs 
Department to renovate and staff the Naval Brig located 
on Treasure Island. Ms. Mariani reports that the 
renovations to the Brig, which will be able to house an 
estimated 140 prisoners, are expected to be completed by 
April, 1999. The Sheriffs Department had originally 
planned to open the Brig during FY 1998-99 by closing 
three of the five floors at Jail No. 3 and transferring 
approximately 240 prisoners from Jail No. 3 to the Brig 
and the City's other jails. The Sheriffs Department 
earmarked 66 positions in its FY 1998-99 budget, 
including 39 positions to be transferred from Jail No. 3 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

10 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



and the 27 positions created through the above-noted 
supplemental appropriation ordinance (Files 101-97-20 
and 102-97-6), to staff the Treasure Island Brig. 
However, according to Ms. Mariani, transferring 
prisoners from Jail No. 3 to the Treasure Island Brig is 
not a viable option at this time due to (a) an insufficient 
number of personnel available to staff the Brig and (b) the 
overall increase in the prisoner population. 

Ms. Mariani advises that, of the 66 positions needed to 
open the Treasure Island Brig, 20 are currently being 
held vacant in order to meet the Department's budgeted 
Attrition Savings. In addition, according to Ms. Mariani, 
if the Sheriffs Department were to close three floors at 
Jail No. 3 at this time, it would be able to transfer 39 
personnel from Jail No. 3 to the Brig (as originally 
planned), but approximately 290 prisoners would have to 
be transferred out of Jail No. 3 to other jail facilities. 
Although the Treasure Island Brig could accommodate as 
many as 140 prisoners from Jail No. 3, Ms. Mariani 
advises that, because of the increased prisoner 
population, there is not sufficient excess capacity at the 
City's other jails to be able to absorb the remaining 150 
prisoners that would have to be transferred out of Jail No. 

3. Attachment II, provided by the Sheriffs Department, 
describes the Department's reasons for not transferring 
prisoners from Jail No. 3 to the Brig. 

4. In response to an inquiry from the Budget Analyst, the 
Sheriffs Department provided additional information on 
the current and proposed minimum staffing requirements 
needed to comply with the proposed settlement agreement 
for Jail No. 3, which are summarized in the table below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

11 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 





Midnight Shift 


Dm Shift 


Swing Shift 


Total 


Current Prupaa) 


U' 


Current Prupahod 


Vm 


■ :■■■-: 


Proposed 


Via 


IM 


•- r.,.-^ 


Vm 


Depurv Sheriff Posts: 


2 10 
2 3 

4 4 


8 

1 



8 10 
2 2 
11 10 


2 


(1) 


8 
2 
7 


10 

2 

7 


2 




18 
6 

22 


30 

7 

21 


12 

1 
Hi 


Tiers' Dormitories 
Escort/ Relief 
Other Duties 


Total Deputies 
Supervisor Posts 


S 17 
1 1 


9 



21 22 
2 2 


1 



17 


19 


2 


46 


• 


12 



Total - Min. Posts 
Relief Factor 


9 18 
1.76 1.76 


9 
1.76 


23 24 
1.76 1.76 


1 
1.76 


18 
1.76 


20 
1.76 


: 

1.76 


50 
1.76 


62 
1.76 


12 
1.76 


Total Positions 
Required 


16 32 


16 


40 42 


2 


3^ 


35 


3 




109 


:i 



As reflected in the table above, the actual minimum fixed 
post staffing needs for Jail No. 3 under the proposed 
settlement agreement requires the creation of 21 new 
positions. However, the Sheriffs Department is currently 
requesting 22 new positions in this supplemental 
appropriation request. The Budget Analyst therefore 
recommends against approval of one of the requested 22 
new positions on this basis. 

Additionally, the table above reflects the Sheriffs 
assessment that, under the proposed settlement, one 
additional Deputy Sheriff post would be needed to provide 
escort/relief during the midnight shift. The Budget 
Analyst disagrees with this assessment that one 
additional Deputy Sheriff post, for a total of three posts, is 
needed for escort/relief during the midnight shift, given 
that the Sheriff has determined that only two escort/relief 
posts are needed during the day and swing shifts, when 
there is more prisoner activity than there is during the 
midnight shift. As such, the Budget Analyst recommends 
against this one additional Deputy Sheriff post, which is 
the equivalent of two positions. 

The Budget Analyst therefore recommends disapproval of 
three of the requested 22 new positions and recommends 
approval of 19 of the requested 22 new Deputy Sheriff 
positions. The Budget Analyst's recommended staffing 
level for Jail No. 3, necessary to comply with the proposed 
Jones settlement agreement, is shown in the table below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 





Midnight Shift 


Dav Shift 


Swing Shift 


Total 


Current 


Proposed 


Var. 


Current 


Proposed 


Var. 


Current Proposed 


Var. 


Current 


Proposed 


Var. 


Deputy Sheriff Posts: 
























Tiers/ Dormitories 


2 


10 


8 


8 


10 


2 


8 10 


2 


18 


30 


12 


Escort/Relief 


2 


2 





2 


2 





2 2 





6 


6 





Other Duties 


4 


4 





11 


10 


(1) 


7 7 





22 


21 


(1) 


Total Deputies 


8 


16 


8 


21 


22 


1 


17 19 


2 


46 


57 


11 


Supervisor Posts 


1 


1 





2 


2 





1 1 





4 


4 





Total - Min. Posts 


9 


17 


8 


23 


24 


1 


18 20 


2 


50 


61 


11 


Relief Factor 


1.76 


1.76 


1.76 


1.76 


1.76 


1.76 


1.76 1.76 


1.76 


1.76 


1.76 


1.76 


Total Positions 
























Required 


16 


30 


14 


40 


42 


2 


32 35 


3 


88 


107 


19 



As reflected in the table above, the approval of these 19 
new positions would still enable the Sheriffs Department 
to comply with the conditions of the Jones settlement that 
at least one Deputy Sheriff be present and on duty at all 
times on each tier/dormitory (of which there are a total of 
10) at Jail #3 in San Bruno. 

As such, the proposed supplemental appropriation 
ordinance should be reduced by $8,851, from $64,904 to 
$56,053, for permanent salaries, and by $2,789, from 
$20,452 to $17,663, for related fringe benefits, for a total 
reduction of $11,640. The annual on-going savings would 
be $192,776 at Step 5, including $152,373 in salaries and 
$40,403 in fringe benefits. 

5. As noted above, the proposed supplemental 
appropriation ordinance assumes a start date of March 1, 
1999 for the $621,600 request to expand the Residential 
Drug Treatment Program. The Budget Analyst 
recommends that this amount be reduced by $149,400, 
from $621,600 to $472,200, in order to reflect a start date 
of April 5, 1999, in accordance with the schedule below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

13 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 











Total Cost 




No. of 


No. of 


Cumulative 


bed' 


Month 


Days 


New Beds 


No. of Beds 


day 


Apnl 


26 


80 


SO 


S 124,800 


May 


31 


10 


90 


S 167,400 


June 


30 


10 


100 


S 180.000 


Total 








S 472.200 



6. The proposed supplemental appropriation ordinance 
also assumes a start date of March 1, 1999 (8.7 pay 
periods) for the $17,000 request for a contract for case 
management services for inmates in the Residential Drug 
Treatment Program. The Budget Analyst recommends 
that this amount be reduced by $4,885, from $17,000 to 
$12,115, in order to reflect a start date of April 5, 1999 
(6.2 pay periods). 

7. According to Ms. Mariani, the request of $73,115 for 
overtime and fringe beneSts for increased supervision of 
the Residential Drug Treatment Program assumes a start 
date of April 8, 1999 (6.0 pay periods) because the extra 
staff to supervise the program will not be needed until 
approximately 5.5 weeks after the start date for adding 
the 100 extra drug treatment beds. Since the Budget 
Analyst has recommended that the start date for adding 
the 100 extra drug treatment beds should begin on April 
5, 1999 instead of March 1, 1999, as explained in 
Comments No. 5 and 6 above, the start date for the 
request for increased overtime should also be reduced by 
five weeks, from April 8, 1999 to approximately May 13, 
1999. As such, the subject request should be reduced by 
(a) $29,977, from $71,946 to $41,969, for overtime, and (b) 
$487, from $1,169 to $682, for related fringe benefits, for a 
total reduction of $30,464, to reflect 3.5 pay periods rather 
than 6.0 pay periods. 

8. The Budget Analyst's recommended reductions are 
summarized in the table below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

14 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



Budget Analyst's 





Requested Recommended 


Recommended 


Program/I .ine Item 


Amount Amount 


Reduction Basis for Recommendation 


FUNDING USES 






Jones Case Settlement Agreement: 






Permanent Salaries 


S 64,904 $ 56,053 


S (8,85 1 ) Position Reduction (see Comment No. 4) 


Fringe Benefits 


$ 20,452 $ 17,663 


$ (2,789) Position Reduction (see Comment No. 4) 



Total - Jones Case Settlement Agreement 



$ 85,356 S 



Expansion of Residential Drug Treatment Program: 

Professional Services: 

Contracts for 1 00 Additional Inmate Beds S 62 1 ,600 $ 

Case Management Services S 17,000 S 



73,716 S (11,640) 



472,200 $ ( 1 49,400) Start Date (see Comment No. 5) 
12,115 S (4,885) Start Date (see Comment No. 6) 



Subtotal - Professional Services 



$ 638,600 $ 



484,315 S 



(154,285) 



Overtime 
Fringe Benefits 


$ 

$ 


71,946 
1,169 


$ 
$ 


41,969 
682 


S 
$ 


(29,977) Start Date (see Comment No. 7) 
(487) Start Date (see Comment No. 7) 


Subtotal - Personnel 


s 


73,115 


$ 


42,651 


$ 


(30,464) 



Total -Expansion of Residential Drug Treatm S 711,715 $ 526,966 S 

Projected Budgetary Shortfalls: 



(184,749) 



Materials & Supplies - Food Costs 
Workers Compensation 


S 
S 


724,559 
289,212 


$ 

s 


724,559 
289,212 


$ 
S 


" 


Total - Projected Budgetary Shortfalls 


s 


1,013,771 


s 


1,013,771 


$ 


- 


TOTAL FUNDING USES 


s 


1,810,842 


s 


1,614,453 


s 


(196,389) 


FUNDING SOURCES 

General Fund Reserve 
Attrition Savings 


s 
s 


1,307,516 
503,326 


s 
$ 


1,092,766 
521,687 


$ 
s 


(214,750) Excess Attrition Savings (Comment No. 1) 
1 8,361 Excess Attrition Savings (Comment No. 1) 



TOTAL FUNDING SOURCES 



$ 1,810,842 $ 1,614,453 S 



(196389) 



As reflected above, the Budget Analyst is recommending 
$196,389 in reduced expenditures. Also, as noted in 
Comment No. 1 above, an additional $18,361 has been 
identified in Excess Attrition Savings from Fringe Benefit 
expenditures. Thus, the portion of the supplemental 
appropriation request to be funded by the General Fund 
Reserve should be reduced by $214,750, from $1,307,516 
to $1,092,766. 



9. The Sheriffs Department agrees with all of the Budget 
Analyst's recommendations, with the exception of the 
Budget Analyst's recommendation to disapprove three of 
the 22 requested new Deputy Sheriff positions. According 
to Ms. Mariani, two of these positions would provide relief 
on the midnight shift in order to (a) permit each Deputy 
Sheriff on duty to take a 45-minute lunch break; (b) 
provide sufficient staff to escort prisoners in need of 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

15 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



medical attention; (c) assure better evacuation during 
emergencies; and (d) improve escort coverage in early 
mornings (5:30 am) for prisoners who must appear in 
court. Ms. Mariani advises that the third position is 
needed as a supervisor during the swing shift. 
Attachment III, provided by the Sheriffs Department, is 
the Sheriffs response to the Budget Analyst's 
recommendations. 

10. Based on the additional information provided by the 
Sheriffs Department, the Budget Analyst still does not 
believe that these three additional Deputy Sheriffs 
positions are needed. The Budget Analyst believes that 
the escort/relief duties described above do not warrant the 
creation of two new positions for the midnight shift, when 
most prisoners are sleeping. There are already two 
escort/relief Deputy Sheriff posts during the midnight 
shift, in addition to five other Deputy Sheriffs and three 
Supervisors who are on duty during the midnight shift 
and can assist in performing escort/relief duties. In 
addition, the Sheriffs request for an additional supervisor 
position during the swing shift is not reflected in the 
minimum staffing requirements provided by the Sheriff to 
the Budget Analyst's Office. The Budget Analyst believes 
that adding two Deputy Sheriff posts to the swing shift, 
as the Sheriff is proposing, does not warrant one 
additional supervisor position. The disapproval of this 
supervisor position would result in a supervisor to staff 
ratio of one supervisor for every seven Deputy Sheriffs, 
which is an acceptable ratio. As noted in Comment No. 4, 
the on-going savings from eliminating these three new 
requested positions would be $192,776 per year at Step 5, 
including $152,373 in salaries and $40,403 in fringe 
benefits. 

Lastly, the Budget Analyst notes that the proposed 
settlement agreement does not specifically state that 22 
additional Deputy Sheriff positions must be created. 
Instead, the proposed settlement states that one Deputy 
Sheriff must be present and on duty on all 10 of the 
occupied tiers and dormitories at all times. The Budget 
Analyst's recommended staffing levels, as shown in the 
second table under Comment No. 4, meet this 
requirement. Ms. Hoeper concurs that the proposed 
settlement agreement does not anywhere specify the need 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

16 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

for 22 new Deputy Sheriff positions, and reports that the 
City Attorney's Office has relied on the Sheriffs 
Department to determine the number of positions needed 
to meet the provisions of the settlement. 

Recommendations: 1. Amend the proposed supplemental appropriation 

ordinance (File 99-0241) to reflect that the funding for the 
22 requested new positions was the subject of previous 
budgetary denial. 

2. Reduce the amount of the proposed supplemental 
appropriation ordinance (File 99-0241) by $196,389, from 
$1,810,842 to $1,614,453, in accordance with Comment 
No. 8 above. 

3. Increase the amount of the proposed supplemental 
appropriation ordinance (File 99-0241) to be funded by 
Excess Attrition Savings by $18,361, from $503,326 to 
$521,687, and reduce the amount to be funded by the 
General Fund Reserve by $214,750, from $1,307,516 to 
$1,092,766. 

4. Approve the proposed supplemental appropriation 
ordinance (File 99-0241), as amended. 

5. Amend the proposed amendment to the Annual Salary 
Ordinance (File 99-0242) by deleting three new 8304 
Deputy Sheriff positions. We recommend approval of 19 
new Deputy Sheriff positions. 

6. Approve the proposed amendment to the Annual 
Salary Ordinance (File 99-0242), as amended. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

17 



Attachment 1 




San Francisco Sheriffs Department 

INTER-OFFICE CORRESPONDENCE 



Shen fT Hennessey 
Assistant Sheriff Mareur 



February 2. 1999 
Rrf: 99-022 



FROM: 
RK: 



°/S4££- 



Kevin Foster 

Residential County Parole Beds • Currently Funded and Proposed expansion 



Our current budget for fiscal year 1998/99 allow? us to contract for *4 residential county parole beds (32 through Sheriff" s general fund budget and 12 through a 
work order from the Health Department - Treatment on Demand) Below da lining of the contracted programs, the number of beds currently funded, and 
proposed expansion. The proposed expansion is based on current excess unfunded capacity with our contractor J 



Program 

Allan-American Rreovery Center 
2024 Hayes Street 
San Francisco. CA 

Jelani, Inc. 

JeJaol House 

1601 Quesada Street 

San Franc:sco. CA 

Start lo Finish 

1 499 Quesada Street 

San Francisco, CA 

Rites of Passage 

1638 Kirkwood Street 
San Francisco. CA 

Latino Commission oo Alcohol and Drug Abuse 
Caia Aztlaa 
380 Longview Drive 
San Bruno. CA 

Casa Maria 

105 McLain Avenue 
Brisbane, CA 

Nrw San Framcisco Location 

Liberation House 
1724 Sterner Street 
San Francisco, CA 

Milestone! 
291 - 10th Street 
San Francisco. CA 

Walden House 

815 Buena Vista West 
San Francisco. CA 



LJirrenlPqla 



Proposed Eipani.on 

3 






18 



dS2 = 20 66-91--* 



MfiR-11-1939 17:43 



SF5D ftDMIN 



City and County of San Francisco 



OFFICE OF THE SHERIFF 




Attachment II 
Page 1 of 2 



£\^ Michael Hennessey 

SHERIFF 
415 - 554 - 7225 



March 11, 1999 
Ref.: BPM 99-020 



TO: Karen Kegg 

Budget Analyst's Office 

FROM: Jean Mariani f 

Budget & Program Manager 

SUBJECT: Use of Treasure Island Brig 

As part of your review of our supplemental appropriation request, you asked for 
information about the possible use of the Treasure Island Brig (Ti). The 
supplemental would provide 22 sworn deputy positions at County Jail #3 (CJ #3) 
for the proposed settlement in the Jones case. 

Treasure Island Brig has 5 dorms with a total of 120 beds and two cellblocks with 
5 cells, each which could be double-bunked for a total capacity of 140. To meet 
our 6.5% attrition savings rate, we are holding vacant 51 sworn positions 
including 20 of the 22 sworn positions budgeted forTI. Full staffing forTI would 
require, in addition to funds for the 20 vacant sworn positions, another 41 sworn 
positions. We had planned to dose three floors at CJ #3 to provide the required 
additional staffing. However, because the jails are currently operating at capacity, 
that is not possible at this time. 

CJ #3 has 58 cells per wing on the 3 rd , 4 m , 5 th , and 6 th floors. It also houses 70 
prisoners in each of two dorms on the 2 nd floor. The jail has a Board of 
Corrections capacity of 557. Under the Jones settlement, the minimum posts per 
floor are 2 deputies. Using a 1.76 relief factor, minimum staffing per floor is the 
equivalent of 1 1 full time sworn positions. 

Assuming we closed one floor at CJ #3 and transferred those prisoners to TI, we 
would need the following sworn positions to fully staff TI and to meet staffing 
requirements for CJ #3 per the Jones settlement: 



CTTY HALL ROOM 456 



1 CARLTON B. COODLETT PLACE 



SAM FRAMCISCO. CA 94 1 02 



FAX 415 • 554 • 7050 



19 



MAR- 11-1999 17:49 SF5D ADMIN 

Attachment II 

Page 2 of 2 









Additional 






Current 


Transfer 


Required 


Net Total 


CJ#3 










Deputies 
Supervisors 


88 
13 


-7 




81 
13 


Proposed Jones Settlement 










Deputies 


22 


-A 




18 


CJ #3 Totals 


123 


-11 




112 


Tl Brig 










Deputies 


20 


11 


26 


57 


Supervisors 


2 




2 


4 


Tl Totals 


22 


11 


28 


61 



Therefore, even if Tl were to open, there would be no reduction in positions for 
the proposed Jones settlement We would merely transfer 4 deputies from CJ #3 
to Tl. In addition to the 22 sworn positions which are the subject of this request, 
we would also need 28 new sworn positions plus funding for the 20 vacant sworn 
deputy positions in the Tl budget, since those are vacant to offset the 
department's attrition savings. To fill all 48 positions effective July 1, 1999, would 
require an additional approximately S3.09 million annually. 



TOTAL P.0 

20 



<-lS-lSS9 03:39 EFSD RDMIN 

x Attachment III 

rage i of 2 



Date: March 18,1999 

To: Karen Kegg, Budget Analyst 

From: Jean Mariani^SherifFs Department 

Re: Recommendations for Supplemental 

Karen - I am faxing you my recommended edits for your report. I think you did an 
excellent job - there's a lot of complicated stuff in here. In addition to edits on 
your fax pages 5-6, 8-12, 1 have the following comments and information. 

Your draft report recommends against the additional escort/relief post on 
midnights at CJ #3 because we only assign two posts during day and swing 
shifts. We disagree with your analysis for the following reasons: 

The proposed Jones settlement, as you correctly report, requires that a deputy 
be physically present in each occupied dorm and tier of the jail. In order to 
accomplish that on midnights, we need sufficient relief staff to: 

Permit each deputy to take, at minimum, a forty-five minute lunch break. 
This translates to 10 deputies times 45 minutes = 450 minutes or 7.5 
hours, essentially one entire post. 

Provide sufficient staff to escort any prisoners in need of medical attention 
(including insulin injections for diabetics) or for other urgent needs, which 
may occur during the shift. 

Assure better evacuation potential in case of a seismic event or fire 
emergency, a recommendation of the City's jail staffing experts, based on 
the obvious inadequacies of the existing facility. 

Provide a more appropriate level of escort coverage for the pulls for courts 
which begin at 5:30 each morning. 

We only assign two posts during the day because we have sufficient deputies not 
assigned within the tiers or dorms but responsible for other duties who are 
available if we need additional staff to cover required escort/relief. This is 
obviously not the case for midnights. 

You also deleted one position because it was not included among the minimum 
posts. That position is actually a Sr. Deputy/Relief Supervisor for swing. (We 
requested a 8304 Deputy instead of an 8306 Sr. Deputy on the assumption that 
we would promote an existing Deputy once all 22 positions complete the 
Academy.) These positions are not relieved when absent, which is why I 
neglected to count them in the minimums. The Sheriff is requesting the additional 



21 



rAR-16-1999 03:39 



SF5D ftDMIN 



Attachment III 
Page 2 of 2 



swing shift position due to the need to assure adequate staffing and relief based 
on existing activity levels because CJ #3 has programs operating until as late as 
10 pm in the evening. There are also inmates working in the kitchen and laundry 
during swing shift, so deputy coverage is required for ALL floors, including the 
basement. Current and proposed staffing for these positions is as follows: 



County Jail #3 


CURRENT 


JONES 




POST 


MIDS I DAYS I SWINGS 


I MIDS 


DAYS 


SWINGS 


Sr. Deputy/Relief 
SuDervisor 


1 


2 


1 




1 


2 


2 



If the Board of Supervisors approves your proposed reduction, we will not have 
sufficient staffing at CJ #3 to meet the terms of the proposed settlement 
agreement. 

P.S. Jo Hoeper's name is misspelled in the report 



22 



Memo to Finance an Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Item 3 - 99-0365 



Department: 



Item: 



Public Utilities Commission (PUC) 
Hetch Hetchy 

Resolution approving the expenditure of funds exceeding 
ten percent of the original contract amount and granting 
an extension of time for completion of Hetch Hetchy 
Contract No. HH-859, Moccasin-Newark Transmission 
Line Tower Painting, Phase II. 



Contract 

Modification Amount: $70,000 



Source of Funds: 



Description: 



Previously appropriated FY 1998-99 Hetch Hetchy 
operating funds. 

In July of 1997, the Public Utilities Commission (PUC) 
awarded Hetch Hetchy Contract No. HH-859 to Midwest 
Painting, Inc. for painting 199 high voltage transmission 
towers along the Moccasin-Newark Transmission Lines 3 
and 4, located in Tuolomne and San Joaquin Counties. 
The total contract was for $300,000 to be completed in 
341 days beginning September 1, 1997 through August 8, 
1998. 



The proposed resolution would extend the original time 
period for the contract by 326 da3 r s, and provide for a 
completion date of June 30, 1999. Although the Board of 
Supervisors appropriates funds for PUC Contractual 
Services, this contract, itself, was not subject to Board of 
Supervisors approval because Section 9.118 of the City's 
Charter only requires that contracts having a term of 
more than 10 years and/or requiring expenditures by the 
City of at least $10 million be subject to approval by the 
Board of Supervisors. 

The PUC subsequently authorized Hetch Hetchy to enter 
into Contract Modification No. 1, in the amount of 
$10,000, with Midwest Painting, Inc. to purchase safety 
equipment, such as body harnesses, face masks and 
emergency medical kits, for Hetch Hetchy staff to monitor 
the work on the high voltage transmission towers by 
Midwest Painting, Inc. Mr. Subhash Shaftri of the PUC 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

23 



Memo to Finance an Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

reports that because the cost of the above-noted safety 
equipment was not more than ten percent above the 
estimated amount of the original contract with Midwest 
Painting, Inc., Hetch Hetchy did not require approval by 
the Board of Supervisors for Contract Modification No. 1 
in accordance with Section 6.6 of the Administrative 
Code. 

Pursuant to authorization from the PUC (Resolution No. 
98-0288) on November 10, 1998, Hetch Hetchy is now 
requesting approval from the Board of Supervisors to 
enter into Contract Modification No. 2, in the amount of 
$70,000, with Midwest Painting, Inc. for Midwest 
Painting, Inc. to paint an additional 39 high voltage 
transmission towers along the Moccasin-Newark 
Transmission Lines 3 and 4, located approximately two 
miles from Calaveras Dam Road in Alameda County. 
This proposed Contract Modification No. 2 would result in 
a total revised contract amount of $380,000, which is 
$80,000 or approximately 27 percent over the original 
contract bid of $300,000. 

Mr. Shaftri states that the Hetch Hetchy plans to pay for 
Contract Modification No. 2 from $70,000 in previously 
appropriated operating funds in its FY 1998-99 budget. 

Budget: The Attachment, provided by the PUC, contains a cost 

breakdown in the amount of $70,000 to support the 
proposed Contract Modification No. 2 in the amount of 
$70,000. 

Comment: 1. Mr. Shaftri reports that although Hetch Hetchy is 

requesting a contract extension of 326 days for Midwest 
Painting, Inc. to paint the subject 39 high voltage 
transmission towers, Midwest Painting, Inc. will begin 
such work on April 12, 1999, after the current rains have 
ended. Mr. Shaftri expects Midwest Painting, Inc. to 
complete its work on the towers in approximately 50 days. 
Work would therefore be completed by June 30, 1999. 

2. According to Mr. Ted Lakey of the City Attorney's 
Office, in accordance with Section 6.7 of the 
Administrative Code, the subject extension of time for the 
completion of Hetch Hetchy Contract No. HH-859, 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

24 



Memo to Finance an Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

requires only the approval of the PUC, which it received 
on November 10, 1998, and does not require Board of 
Supervisors approval. Therefore, the proposed resolution 
should be amended to delete reference to Board of 
Supervisors approving the extension of time for 
completion of Hetch Hetchy Contract No. HH-859. 

Recommendations: 1. In accordance with Comment No. 2 above, amend the 

proposed resolution to delete reference to the Board of 
Supervisors approving the extension of time for 
completion of Hetch Hetchy Contract No. HH-859. 

2. Approve the proposed resolution as amended. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

25 



Uj u-yy ud:uu rw 



HH-859 
Moccasin-Newark Transmission Line Tower Painting Phase II 

COST BREAKDOWN FOR CONTRACT MODIFICATION NO. 2 



Item 
No. 


Description 


Est Qty. 
& Unit 


Unit 

Price 


AMOUNT 


I 


Paint Remaining High Voltage Towers 


39 EA 


1393.03 


$54,328.17 


2 


Traffic Routing 


LS 


. 


515,671.83 


TOTAL 


$70,000.00 



PoBt-ir Fax Note 



7671 









59- 



l 1 "^" i 



PilrJ Liga 
" 5S4-- ifl7?. 
g^»- QT7c; 



26 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Item 4 - File 99-0359 



Department: 

Item: 
Description: 



Proposed Budget: 



Department of Children, Youth and Their Families 
(DCYF) (formerly the Mayor's Office of Children, Youth 
and Their Families) 

Resolution approving the FY 1999-2000 Children's 
Services Plan in accordance with Charter Section 16.108. 

Proposition J, commonly known as the "Children's 
Amendment," was approved by the electorate in 
November 1991. The Children's Amendment amended 
the Charter to require the establishment of the Children's 
Fund. 

The Children's Amendment requires that the Mayor 
submit to the Board of Supervisors, by December of each 
year, a "Children's Services Plan" for the next fiscal year 
to specify the goals and objectives to be achieved through 
expenditures from the Children's Fund, to outline 
proposals for expenditures form the Children's Fund, and 
to recommend City Departments to administer the funded 
programs. The proposed resolution would approve the FY 
1999-2000 Children's Services Plan. 

According to Ms. Deborah Alvarez-Rodriguez of DCYF, 
the Children's Services Plan was not submitted to the 
Board of Supervisors by December of 1998, as required by 
the Charter, because the Director's position was vacant 
for over six months until Ms. Alvarez-Rodriguez assumed 
the position in November 1998. Additionally, DCYF had 
to hold 11 community hearings and six commission 
hearings to develop the Children's Services Plan, as 
required by the Charter. 

The proposed FY 1999-2000 Children's Services Plan has 
a budget of $16,680,000. DCYF intends to use quality of 
life benchmarks and indicators developed by local and 
national research institutions, City departments, 
community-based organizations, and DCYF program 
consumers, to guide funding priorities. These 

benchmarks include: children and families are healthy; 
children are ready to learn and are succeeding in school; 
and children live in safe and supported families. 

As shown in Attachment I provided by the DCYF, the 
proposed Children's Services Plan budget of $16,680,000 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

27 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

includes $2,330,622 for services to be provided by City 
departments, $12,250,100 for nonprofit agency 
community-based programs (CBO's) under contract to 
DCYF, $1,399,278 for administrative costs, and $700,000 
for evaluation costs. Attachment II, provided by DCYF, 
details the proposed estimated allocation for each CBO. 

Comments: 1. The Children's Amendment requires that the City 

maintain a level of expenditure for children's services 
which is equal to or greater than the level of expenditure 
in FY 1990-91 or FY 1991-92, whichever is greater, and 
sets aside Property Tax revenues to fund additional 
services above and beyond the level of service funded 
prior to adoption of the Children's Amendment. The 
amount of these Property Tax revenues is 2.5 cents per . 
$100 of assessed valuation. The Children's Amendment 
has been in effect for seven years and will expire after a 
total often years in 2002. 

2. In 1992, the Controller certified that the City's 
appropriation for children's services prior to adoption of 
the Children's Amendment totaled approximately $50 
million. This baseline amount of approximately $50 
million represents the required minimum expenditure by 
the City for children's services in each of the ten fiscal 
years. Each succeeding year, the baseline amount has 
been and is adjusted annually by the percentage change 
in aggregate City appropriations since the base j'ear. 

3. The amount of the Children's Fund in FY 1998-99 was 
$15,011,576. According to Mr. John Madden of the 
Controller's Office, a more precise estimate for the 
Children's Fund for FY 1999-2000 will not be available 
until early April, 1999. Therefore, for the purposes of this 
Children's Services Plan, the DCYF has estimated that 
the Children's Fund for FY 1999-2000 will be $16,680,000 
which represents an increase of $1,668,424 over the FY 
1998-99 Children's Service Plan of $15,011,576. 

4. The Children's Amendment requires a public planning 
process, in which public hearings are to be held by the 
Public Health, Juvenile Probation, Human Services, 
Recreation and Parks, Youth, and Public Library 
Commissions prior to submission of the Children's 



BOARD OF SUPERVISORS 
BUDGET ANALYST 
28 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Services Plan to the Board of Supervisors. According to 
Ms. Alvarez-Rodriguez, those commission hearings were 
held between February 24, 1999 and March 2, 1999. 

5. The anticipated FY 1999 -2000 Children's Fund budget 
includes administrative costs of $1,399,278, or 8.4 percent 
of the total budget, as compared to the FY 1998-99 budget 
for administrative costs of $1,132,128, or 7.5 percent of 
that total budget. The anticipated increase for 
administrative costs in FY 1999-2000 over FY 1998-99 is 
$267,150, or 23.5 percent. Attachment III is a 
memorandum from Ms. Alvarez-Rodriguez explaining 
why administrative costs for FY 1999-2000 are increasing 
by 23.5 percent over FY 1998-99. 

6. As shown in Attachment I, the proposed Children's 
Budget includes $700,000 for evaluation costs, 
representing a $600,000, or 700 percent increase from the 
FY 1998-99 amount of $100,000 for such evaluation costs. 
Ms. Alvarez-Rodriguez reports that the DCYF is placing 
greater emphasis on accountability and evaluation 
compared to previous years. This amount of $700,000 for 
evaluation has not yet been allocated to any specific 
nonprofit agency or outside consultant. 

7. Approval of the proposed resolution would not 
authorize the appropriation of any funds, but rather, 
would approve the FY 1999-2000 Children's Services 
Plan, as required by the Charter. All expenditures will be 
subject to appropriation approval by the Board of 
Supervisors in the FY 1999-2000 budget and will be 
reviewed in detail by the Budget Analyst. 

Recommendations: 1. Amend the proposed resolution to require that on or 

about July 15, 1999, the Department of Children, Youth 
and Their Families submit a detailed budget supporting 
the $700,000 allocation for evaluation services, including 
the identification of all outside consultants and nonprofit 
agencies, the amount allocated to each specific 
organization, and the estimated hours of service to be 
provided and the average hourly rates to be charged by 
each organization. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

29 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



2. Approval of the proposed resolution, as amended, is a 
policy matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

30 



PROPOSED CHILDREN'S FUND BUDGET - 1999-2000 



ATTACHMENT I 



ADMINISTRATIVE 

Salary 

Fringe Benefits 
Rent 

Materials & Supplies 
Agency Support 
Other Office Expense 
Travel & Training 
Services of Other Depts 
Total Administrative 





CSP 




Proposed 


Budget 


Budget 


Evs&m 


FY 99/00 


753,796 


882,123 


182,021 


208,507 


85,000 


119,368 


18,000 


50,500 


21.411 


30,000 


30,000 


37,900 


7,200 


27,680 


34.700 


43 200 


1,132,128 


1,399,278 



DIRECT SERVICES 



Funding for CBO's 
Funding for City Depts/ SFUSD & 
PIC 

Total Direct Services 

Other Direct Services (Evaluation) 
Total Direct Services 



11,325,000 

2,454,448 
13,779,448 

100,000 
13,879,448 



12,250,100 

2,330,622 
14,580,722 

700,000 
15,280,722 



Total Expenses 



15,011,576 



16,680,000 



Administrative Expenses as a 
Percentage of the Total Fund 



8% 



8% 



31 



ATTACHMENT II 
page 1 of 1 



APPENDIX B: 



DCYF - Estimated 1999-2000 Children's Fund $ for Direct Services 
PROVIDER 
A Home Away from Homelessness 



•Award 

S40.000 



Asian Women's Resource Center (AWRC) 


S181.197 


Audrey L Smith Developmental Center, Inc. 


S1 57,000 


Audrey L. Smith Developmental Center, Inc. 


S227.527 


Bernal Heights Neighborhood Center 


S255.109 


Booker T. Washington Community Service Center 


$130,715 


Bridges From School To Work, Marriott Foundation For People with Disabilities 


S152.211 


California Association for Health, Education, Employment, and Dignity. Inc. 


S330.000 


California Lawyers for the Arts 


S135.322 


Center on Juvenile and Crimal Justice 


S1 78.500 


Central City Hospitality House 


S226.050 


Charity Cultural Services Center 


S75.S72 


Children's Council of San Francisco 


$470,220 


Columbia Park Boys and Girls Club 


S300.000 


Columbia Park Boys and Girls Club-Excelsior Youth Center 


$50,000 


Communities in Harmony Advocating for Learning and Kids 


S201.427 


Community Educational Services 


S102.000 


Community United Against Violence 


S233.059 


Cross Cultural Family Center 


S 170.000 


Economic Opportunity Council of San Francisco 


$151,000 


Edgewood Center For Children & Families 


S1 00.000 


Ella Hill Hutch Community Center 


S219.440 


Ella Hill Hutch Community Center 


S100.702 


Family Service Agency of San Francisco 


S78.204 


Filipino-American Council of San Francisco 


S51.000 


Geneva Valley Development Corporation 


S342.226 


Girls After School Academy 


S50.000 


Girls and Boys Against Gangs, Inc. 


S50.000 


Glide Memorial Church 


S125.000 


Good Samaritan Family Resource Center 


S178.500 


High Gear Achievers Inc. 


S84.999 


Homeless Children's Network 


S178.500 


Horizons Unlimited of San Francisco, Inc. 


$163,200 


Hunters Point Boys' & Girls' Club 


S40.800 


Ingleside Community Center 


$120,950 


Inner City Youth 


S75.500 



32 



2S 



ATTACHMENT II 
page 2 of 3 



International Institute of San Francisco 


S50.000 


Jamestown Community Center 


551,000 


Japanese Community Youth Council (MYEEP) 


51,246,933 


Japanese Community Youth Council (JCYC) 


S50.638 


Japanese Community Youth Council/ (Richmond Beacon) 


$250,000 


Jewish Vocational and Career Counseling Service 


S330.000 


Korean American Women Artist & Writers Association (KAWAWA) 


3100,000 


Lavender Youth Recreation & Information Center, Inc. (LYRIC) 


$101,437 


Legal Services for Children, Inc. 


S50.000 


Little Children's Development Center 


S50.000 


Mission Child Care Consortium, Inc. 


$101,087 


Mission Language and Vocational School, Inc. 


S75.499 


Moss Beach Homes Inc. d.b.a Aspira Foster and Family Services (Beacon) 


S300.000 


Moss Beach Homes, Inc. 


$111,299 


New Direction 


S75.943 


Our Kids First 


S40.800 


Portola Family Connections, Inc. 


S100.000 


Potrero Hill Neighborhood House 


S76,500 


Real Alternatives Program (RAP) 


$290,000 


Richmond District Neighborhood Center 


$219,300 


SAGE Project, Inc. 


S50.000 


Samoan Community Development Center 


$101,229 


San Francisco Child Abuse Council 


$35,000 


San Francisco Educational Services, Inc. (SFES) 


$114,945 


San Francisco Educational Services, Inc. (SFES) (BVHP Beacon) 


S305.000 


San Francisco Educational Services, Inc. (SFES) (Beacon) 


$300,000 


San Francisco League of Urban Gardeners (SLUG) 


S1 02,000 


San Francisco State University Foundation 


$181,816 


San Francisco Study Center Inc. 


$76,253 


San Francisco Women Lawyers Alliance Foundation 


S25.480 


South of Market Child Care, Inc. 


$50,000 


South of Market Council 


$50,000 


St. John's Educational Thresholds Center (Mission Beacon) 


S300.000 


Telegraph Hill Neighborhood Center Organization 


S102.000 


Tenderloin Neighborhood Development Corporation 


$45,743 


The Arks of Refuge 


S50.000 


The Family School 


$147,400 


The San Francisco Urban Service Project 


$50,000 


Third Baptist Church Academic Summer School 


S25.000 


Vietnamese Youth Development Center 


S80.835 


Visitacion Valley Community Center (Visitacion Valley Beacon) 


$300,000 



29 
33 



ATTACHMENT I I 
page 3 of 3 



Wajumbe Cultural Institution, Inc. 


S125.721 


West Bay Pilipino Multi-Service, Inc. 


S161.272 


Western Addition Beacon 


S300.000 


Wu Yee Children's Services (Chinatown Beacon) 


S300.000 


Wu Yee's Children Services 


S543.000 


Youth Guidance Center Improvement Committee 


579,550 


Youth Leadership Institute 


5100,000 


YMCA-(OMI Beacon) 


5300,000 


YWCA of San Francisco 


5101.054 



Total (including leveraged dollars) 513.935, 100 

Contributions from Funding Sources other than Prop. J S1 ,825,000 

Estimated Children's Fund S For CBO's $12,110,100 

Estimated Children's Fund $ For Potential CBO COLA'S ^140,000 

Estimated Children's Fund $ For City Departments $2,330,622 

Private Industry Council S254.000 

Department of Public Health S541 .235 

Department of Human Services 5253,546 

SF Public Library $420,000 

Juvenile Probation Department 5194.000 

SF Art Commission S1 50.000 

San Francisco Unified School District S283.000 

Recreation and Parks 5234,841 

Total Estimated Children's Fund $ For Direct Services $14,580,722 



30 



34 



ftL Lacnmenu lll 



Department of Children, 
Youth and Their Families 



Memo 



To: Mr. Harvey Rose, Budget Analyst and Shirley^ Lee 

From". Ms. Deborah Alvarez-Rodriguez 

Date: 03/18/99 

Re: Administrative Costs Narrative 




The 1999-2000 Children's Services Plan continues to limit administrative costs 
for the Children Fund to 8 percent of total expenditures. The administrative 
costs in fiscal year 1998-99 totaled $1,132,128 while 1999-2000 projections 
total $1,399,278. The increase in administrative costs are due to: 

• The 1998-99 budget included $1,132,128 in administrative costs and 
$100,000 in planning and development costs. We have moved all planning and 
development costs into the administration cost center. 

• We have added a full-time 1371 citywide Childcare Coordinator to the 1999- 
2000 administrative budget at approximately $70,000 salary and fringe 
benefits. Additionally, in order to fully implement a computerized grants 
management database and improve public accountability we propose 
increasing our MIS staff from .16fte to 1.0 fte, approximately $55,000 
increase in salary and fringe. Other salary adjustments to reflect 1998-99 
budgeted positions estimated at $18,568. Total estimated increase in 
salaries $143,568. 

• We estimate building rent increase of $23,582 due to annual operating 
increases and the need for an additional 1000 sq. feet to accommodate the 
expansion of Childcare planning staff and services. 



Pagel 



35 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Items 5. 6, 7. 8, 9, 10, 11, 12, 13. and 14 - Files 99-0272. 99-0271, 99-0273. 99-0274. 
99-0276. 99-0277, 99-0278. 99-0279, 99-0373, and 99-0317 

Note: Items 5 through 12 were continued from the Finance and Labor Committee 
Meeting of March 10, 1999. 



Departments: 



Items: 



Department of Human Resources (DHR) 
Department of Public Transportation (Muni) 

Item 5, File 99-0272 - Ordinance implementing the 
provisions of an amendment to Article V.I of the 
Memorandum of Understanding (MOU) between the 
Stationary Engineers, Local 39, and the City and County 
of San Francisco, providing for an Employee Assistance 
Program through the expiration of the MOU in 2001. 

Item 6, File 99-0271 - Ordinance implementing the 
provisions of an amendment to Article V.H of the MOU 
between the International Brotherhood of Electrical 
Workers, Local 6, and the City and County of San 
Francisco, providing for an Employee Assistance Program 
through the expiration of the MOU in 2001. 

Item 7, File 99-0273 - Ordinance implementing the 
provisions of an amendment to Article IV.F of the MOU 
between the Building Material and Construction 
Teamsters, Local 216, and the City and County of San 
Francisco, providing for an Employee Assistance Program 
through the expiration of the MOU in 2001. 

Item 8, File 99-0274 - Ordinance implementing the 
provisions of an amendment to Article IV of the MOU 
between the Transport Workers Union of America, AFL- 
CIO, and the Transport Workers of America, Local 250A 
(7410 Automotive Service Workers), and the City and 
County of San Francisco, providing for an Employee 
Assistance Program through the expiration of the MOU in 
2001. 

Item 9, File 99-0276 - Ordinance implementing the 
provisions of an amendment to Section 19 (Drug 
Treatment) of the MOU between the Transport Workers 
Union of America, AFL-CIO, and the Transport Workers 
of America, Local 250A (9163 Transit Operator and 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

36 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Related Trainee Classifications), and the City and County 
of San Francisco, providing for an Employee Assistance 
Program through the expiration of the MOU in 2000. 

Item 10, File 99-0277 - Ordinance implementing the 
provisions of an amendment to Article IV. E of the MOU 
between the Laborers Union, Local 261, and the City and 
County of San Francisco, providing for an Employee 
Assistance Program through the expiration of the MOU in 
2001. 

Item 11, File 99-0278 - Ordinance implementing the 
provisions of an amendment to Article IV. G of the MOU 
between the Glaziers and Glass Workers, Local 718, and 
the City and County of San Francisco, providing for an 
Employee Assistance Program through the expiration of 
the MOU in 2001. 

Item 12, File 99-0279 - Ordinance implementing the 
provisions of an amendment to Article IV. J of the MOU 
between the Automotive Mechanics Union Lodge No. 
1414, and the City and County of San Francisco, 
providing for an Employee Assistance Program through 
the expiration of the MOU in 2001. 

Item 13, File 99-0373 - Ordinance implementing the 
provisions of an amendment to Section 32 of the MOU 
between the Service Employees International Union, 
Local 790, and the City and County of San Francisco, 
providing for an Employee Assistance Program through 
the expiration of the MOU in 2000. 

Item 14, File 99-0317 - Ordinance implementing the 
provisions of an amendment to Article IV of the MOU 
between the Transport Workers Union of America, AFL- 
CIO, the Transport Workers of America, Local 200, and 
the City and County of San Francisco, providing for an 
Employee Assistance Program through the expiration of 
the MOU in 2001. 

Description: The Board of Supervisors previously approved legislation 

ratifying MOUs with the following 10 labor organizations 
that represent certain classes of "safety sensitive" Muni 
employees: 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

37 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



> International Brotherhood of Electrical Workers, Local 
6 

> Stationary Engineers, Local 39 

> Building Material and Construction Teamsters, Local 
216 

> Transport Workers Union (TWU), Local 250A (7410 
Automotive Service Worker) 

> Transport Workers Union (TWU), Local 250A (9163 
Transit Operator and Related Trainee Classifications) 

> Laborers Union, Local 261 

> Glaziers and Glass Workers, Local 718 

> Automotive Mechanics Union Lodge No. 1414 

> Transport Workers Union (TWU), Local 200 

> Service Employees International Union (SEIU), Local 
790 

Each of the subject 10 MOUs cited above required the 
establishment of an Employee Assistance Program (EAP) 
within the Department of Public Transportation (Muni) 
for safety sensitive Muni employees. 1 Muni's Employee 
Assistance Program was established in 1995 to 
complement the Federally-mandated Substance Abuse 
Program, which requires drug testing for certain classes 
of Muni employees deemed to be "safety sensitive" by the 
U.S. Department of Transportation. Muni reports that 60 
Muni classifications, representing approximately 3,497 of 
the 3,845 existing Muni employees, are considered to be 
safety sensitive job classes and are therefore covered by 
Muni's Substance Abuse and Employee Assistance 
Programs. Attachment I shows the classes and job titles 
of the 3,497 safety sensitive Muni employees covered by 
the 10 MOUs above. 

Muni's EAP is designed to assist employees with problems 
that may affect their ability to perform their jobs. Unlike 
employees involved in the Substance Abuse Program, 
employees who participate in the EAP do so on a 
voluntary basis. The EAP is intended to encourage 
employees to seek treatment for substance abuse, family 
problems, depression, stress and other problems, before 



There is also a separate, city wide Employee Assistance Program, administered by the 
Department of Public Health (DPH), for all City employees. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

33 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



they lead to a positive drug test or disciplinary problems. 
The EAP offers Muni employees information, guidance, 
referrals, counseling and follow-up services. 

The existing MOU between the Transport Workers Union 
(TWU), Local 250A for 9163 Transit Operators states that 
the City shall contribute up to $150,000 per year for 
Muni's Employee Assistance Program. The existing 
MOUs between the City and the other nine labor 
organizations representing non-platform safety sensitive 
Muni employees state that the City shall contribute up to 
$75,000 per year as the total amount for the other subject 
nine MOUs to fund the Muni Employee Assistance 
Program. Thus, the City is required under current MOU 
provisions to contribute up to $225,000 per year ($150,000 
plus $75,000) to Muni's EAP. The proposed ordinances 
would not result in any change to the City's maximum 
contribution to the EAP. 

The proposed ordinances would implement the provisions 
of an amendment to Muni's EAP in each of the 10 MOUs 
to clarify certain language and reflect changes in the 
program since it was first implemented in 1995. The 
amendments to the EAP are described below. 

Duties of Outside Contractor 

Contracts for EAP Services to Transit Operators 
In 1995, through a Request for Proposals (RFP) process, 
the Board of Trustees of the Municipal Railway Trust 
Fund 2 awarded a one-year contract to Claremont 
Behavioral Services to provide substance abuse treatment 
referral and EAP services to Muni employees in the 9163 
Transit Operator classification . The amount of this 
contract was $58,195, based on Claremont's rate of $2.80 



Pursuant to Charter Section A8.404, maximum wages for Transit Operators are established based 
on the average of the two highest wage schedules for comparable transit systems in the United 
States. Charter Section A8.404 further provides that, when the value of vacation, retirement, and 
health service benefits is less than the value of such benefits provided by the two transit systems 
used for establishing wage schedules, a dollar amount of General Fund monies, not to exceed the 
difference between the average value of the benefits package in the two comparable systems and 
the benefits package provided by the City, may be deposited into a Municipal Railway Trust Fund. 
The Municipal Railway Trust Fund is administered by a Board of Trustees, consisting of 
representatives of Muni and TWU, Local 250A. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

39 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



per employee per month for the 1,732 Transit Operators 
at that time (approximately $4,850 per month). The term 
of the contract was the period July 1, 1995 through June 
30, 1996. The source of funding for this contract was the 
Municipal Railway Trust Fund. 

In April, 1998, the Board of Trustees of the Municipal 
Railway Improvement Fund awarded a new contract to 
Claremont Behavioral Services to provide EAP services to 
Transit Operators for the four-year period retroactive to 
July 1, 1996 through June 30, 2000. Under the terms of 
the new contract, as of July 1, 1998, Claremont also 
assumed responsibility for managing the Peer Assistance 
Program, a program established in 1995 in which Muni 
employees serve as Peer Assistants for fellow Muni 
employees. Claremont's fee for this contract is $5,000 per 
month for EAP services ($240,000 over the four-year term 
of the contract or $60,000 per year), plus approximately 
$4,667 per month for Peer Assistance Program services 
($112,000 for the two-year period July 1, 1998 through 
June 30, 2000, or $56,000 per year). Thus, the total 
amount of the four-year contract is $352,000, consisting of 
$60,000 per year for the first two years ($120,000 total for 
EAP services only), and $116,000 per year for the second 
two years ($232,000 total, including $120,000 for EAP 
services and $112,000 for Peer Assistance Program 
services). The source of funding for this contract is 
General Fund monies allocated to the Municipal Railway 
Improvement Fund. The Municipal Railway 

Improvement Fund is also administered by the Board of 
Trustees for the Municipal Railway Trust Fund. 

Contracts for EAP Services to Non-platform Safety 
Sensitive Muni Employees 

In 1995, through an RFP process, the Public 
Transportation Commission (PTC) awarded a one-year 
contract to Claremont Behavioral Services to provide 
substance abuse treatment referral and EAP services to 
non-platform safety sensitive Muni employees . The 
amount of this contract was $75,000, consisting of (a) 
$36,960 for Claremont's fee (based on Claremont's rate of 
$2.80 per employee per month for the 1,100 non-platform 
safety sensitive Muni employees at that time), (b) a 
reinsurance fee of $4,500; and (c) $33,540 for claims by 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

40 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



employees referred for substance abuse treatment 
services. The term of the contract was the period July 1, 
1995 through June 30, 1996. 

In 1996, PTC approved a resolution extending 
Claremont's contract for one year, from July 1, 1996 
through June 30, 1997. Because, effective July 1, 1996, 
substance abuse treatment services began being provided 
to City employees through the City's Health Service 
System, the amount of this one-year extension was only 
$25,000, in order to reflect that Claremont would only be 
providing EAP services. The source of funding for both the 
original contract and the one-year extension were General 
Fund monies included in Mum's annual budget. 

Since July 1, 1997, Claremont has been providing EAP 
services to non-platform safety sensitive employees 
without a contract. According to Mr. Thomas Bjornson, 
CEO of Claremont Behavioral Services, Claremont has 
made repeated attempts to execute a new contract with 
Muni since July 1, 1997, but with no success. Mr. 
Bjornson advises that Claremont did receive payment of 
$25,000 from Muni for services rendered to non-platform 
safety sensitive Muni employees during FY 1997-98. 
However, according to Mr. Bjornson, Claremont has 
received no payment since July 1, 1998 for services 
rendered during this fiscal year. In addition, Mr. 
Bjornson further advises that Claremont assumed 
responsibility for managing the Peer Assistance Program 
on July 1, 1998 for both Transit Operators (as noted 
above) and non-platform safety sensitive employees. 

Ms. Cindy Monroe of Muni advises that a second contract 
modification that would have extended Claremont's 
contract for one additional year, or from July 1, 1997 
through June 30, 1998, was signed by both parties but 
was never approved by the PTC. Ms. Monroe further 
advises that Muni is currently in the process of preparing 
a PTC resolution to modify Claremont's contract, which 
expired on June 30, 1997, to extend it retroactive to July 
1, 1997 through June 30, 2000, and to reflect Claremont's 
additional responsibilities with respect to supervising the 
Peer Assistance Program. Ms. Monroe reports that the 
amount of this contract modification would be $131,000, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

41 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



consisting of $25,000 for the first year (for EAP services 
only), and $53,000 per year for the second two years 
($106,000 total, including $50,000 for EAP services and 
856,000 for Peer Assistance Program services). This 
amount is based on Claremont's fee of $25,000 per year 
for EAP services, plus approximately $2,333 per month 
for Peer Assistance Program services ($56,000 for the two- 
year period July 1, 1998 through June 30, 2000, or 
$28,000 per year). The source of funding for the contract 
modification will be funds included in Muni's FY 1998-99 
and FY 1999-00 annual budgets. 

The modified EAP would delineate Claremont Behavioral 
Services' ongoing responsibilities as well as the additional 
duties assumed by Claremont in 1998. These 

responsibilities include: 

> Maintaining a toll-free employee hotline; 

> Consultation to Muni management and unions on EAP 
implementation; 

> EAP training for Muni and union management and 
staff; 

> Up to three counseling sessions per family per year to 
employees and their dependents; 

> Up to three legal, three financial and three medical 
consultations per employee per year (a total of nine 
sessions per employee per year); 

> Referral services for treatment and/or assistance; 

> Continuing contact between the employee, treatment 
agent and employer on case status; 

> Monthly statistical evaluation of program activities; 

> Attendance at monthly meetings of the Muni 
Improvement Fund Board of Trustees; 

> Up to three counseling visits per year and case 
management for employees who have been involved in 
critical incidents; 

> Critical incident policies and procedures; 

> On-going educational and training information on 
substance abuse; 

> Clinical and administrative management of the Peer 
Assistance Program; 

> An on-site clinician to provide counseling services for 
the Peer Assistance Program for a minimum of 20 
hours per week; and 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



> Procedures for the Peer Assistance Program 

The Peer Assistance Program 

A Peer Assistance Program was established in 1995 for 
Muni employees in need of assistance to deal with 
chemical dependency. Under this program, qualified 
Muni employees may volunteer to serve as Peer 
Assistants for a period of two years in order to respond to 
requests for assistance from fellow Muni employees. 

There are three Peer Assistants dedicated to the Peer 
Assistance Program on a full-time basis for the 3,497 
safety sensitive Muni employees covered by the EAP. In 
accordance with existing provisions of the 10 subject 
MOUs, two of these Peer Assistants are 9163 Transit 
Operators and one Peer Assistant is a non-platform safety 
sensitive Muni employee (currently a 7410 Automotive 
Service Worker). Peer Assistants continue to receive their 
regular full-time rate of pay while fulfilling their duties as 
Peer Assistants. Peer Assistants are also required to 
respond to calls to a crisis hotline (a cellular phone) on 
rotating 24-hour shifts. During non-working hours, the 
Peer Assistant who covers this hotline is entitled to 
receive pager premium pay. However, according to Mb. 
Monroe, in practice, Peer Assistants have never received 
pager premium pay. No additional compensation is 
authorized for Peer Assistants while covering the crisis 
hotline during their regular working hours. 

There is also a Public Transportation Department (PTD) 
Liaison, a Muni employee appointed by the Director of 
Public Transportation, to serve as the City's liaison in 
matters such as labor relations and administrative issues 
related to the Peer Assistance Program. The duties of the 
PTD Liaison are currently being performed by Muni's 
Personnel Director, who spends approximately two hours 
per week (0.05 FTE) on duties related to this post. 

The modified EAP would reflect the following changes to 
the Peer Assistance Program since its inception in 1995: 

> As noted above, the management and administration 
of the Peer Assistance Program is now the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

43 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



responsibility of the outside contractor, Claremont 
Behavioral Services. Prior to July, 1998, the Peer 
Assistance Program was overseen by the Director of 
Muni's mandatory Substance Abuse Program. 
However, according to Mr. Ray Antonio of TWU, Local 
250A, this type of reporting structure resulted in 
problems with protecting employee confidentiality. 
For example, according to Mr. Antonio, in some 
instances, employees who had relapses after obtaining 
treatment through the mandatory Substance Abuse 
Program did not participate in the voluntary EAP out 
of fear that Substance Abuse Program staff, who also 
administered the EAP, would learn of their relapse 
and take disciplinary action against them. As such, a 
decision was made by Muni management to transfer 
oversight of the Peer Assistance Program from the 
Substance Abuse Program Director to the contractor. 
This change is now reflected in Claremont's contract 
and in the modified EAP. 

> A Peer Assistance Oversight Committee has been 
established to perform trouble-shooting, make 
decisions on program operations, and, in coordination 
with the outside contractor, develop procedures for the 
Peer Assistance Program. The Peer Assistance 
Oversight Committee consists of five full-time union 
employees. Prior to July, 1998, the duties of the Peer 
Assistance Oversight Committee were performed by a 
Joint Labor-Management Committee, consisting of five 
full-time union employees and five Muni managers, 
which also oversees the mandatory Substance Abuse 
Program. For the same reasons cited above (to protect 
employee confidentiality), a decision was made by 
Muni management to transfer the Joint Labor- 
Management Committee's duties related to the Peer 
Assistance Program to the newly formed Peer 
Assistance Oversight Committee. This change is 
reflected in the modified EAP. 

The modified EAP also adds language to reflect the 
existence of the PTD Liaison and clarifies existing 
language on the qualifications and duties of Peer 
Assistants. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

44 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



Comments: 



Recommendation: 



The amended provisions of Muni's Employee Assistance 
Program would be in effect for the period retroactive to 
July 1, 1998 through the expiration of the MOUs on June 
30, 2000 (for the MOUs with the Transport Workers 
Union, Local 250A for 9163 Transit Operators and SEIU, 
Local 790), or June 30, 2001 (for the eight other MOUs). 

1. Attachment II, provided by the Controller's Office, is 
the Controller's cost analysis of the proposed MOU 
amendments. According to Ms. Peg Stevenson of the 
Controller's Office, the proposed MOU amendments would 
result in minimal incremental costs to the City. The 
Budget Analyst concurs with the Controller's cost 
analysis. 

2. The Budget Analyst's estimated value of services that 
would normally be performed by the two 9163 Transit 
Operators, one 7410 Automotive Service Worker, and 0.05 
FTE Personnel Director, who instead of performing their 
regular Muni duties are currently performing duties 
related to the Peer Assistance Program, is approximately 
$165,637 per year, based on the annual salaries (at Step 
5) and fringe benefits for these three positions. 

3. Attachment III, provided by the EAP contractor, 
Claremont Behavioral Services, shows the number of 
Muni employees who have voluntarily participated in the 
EAP by fiscal year from July 1, 1995 through March 11, 
1999. As shown in Attachment III, Claremont Behavioral 
Services has recorded a total of 901 EAP cases involving 
Muni employees between July 1, 1995 and March 11, 
1999, or an estimated average of 241 cases annually. 

Because the proposed ordinances (a) would implement the 
provisions of an amendment to Muni's Employee 
Assistance Program to clarify language and to reflect 
existing practice, and (b) would have no additional fiscal 
impact, we recommend approval of the proposed 
ordinances. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



45 



Attachment I 
Page 1 of 2 



Qass Position Title 

Stationary Engineers. local 39: 

7223 Cable Machinery Supervisor 

7286 Wire Rope Cable Maintenance Supervisor 

7334 Stationary Engineer 

7472 Wire Rope Cable Maintenance Mechanic 

7473 Wire Rope Trainee 



No. of Safety 

Sensitive Muni 

Employees 

1 

1 

21 

10 

2 



Total - Local 39 (5 classes) 35 

International Brotherhood of Electrical Workers. Local 6: 

7214 Electrical Transit Equipment Supervisor 1 

7216 Electrical Transit Shop Supervisor I 7 

7235 Transit Power Line Supervisor I 7 

7238 Electrician Supervisor I 1 

7244 Power Plant Supervisor I 1 

7253 Electrical Transit Mechanic Supervisor I 6 

7255 Power House Electrician Supervisor I 1 

7256 Electric Motor Repair Supervisor I 1 
7258 Maintenance Machinist Supervisor I 3 
7279 Power House Electrician Supervisor II 1 
73 1 8 Electronic Maintenance Technician 88 
7329 Electronic Maintenance Technician Assistant Supervisor 17 
7338 Electrical Line Worker 23 
7345 Electrician 6 

7364 Power House Operator 5 

7365 Senior Power House Operator 5 

7379 Electrical Transit Mechanic 156 

7380 Electrical Transit Mechanic, Assistant Supervisor 19 
7390 Welder 12 

7408 Assistant Power House Operator 2 

7409 Electrical Transit Service Worker 53 
7430 Assistant Electronic Maintenance Technician 25 
7432 Electrical Line Helper 2_ 

Total - Local 6 (23 classes) 442 

Building Material and Construction Teamsters. Local 216: 

7355 Truck Driver 6 



Total -Local 216(1 class) 

Transport Workers of America. Local 

7410 Automotive Service Worker 

9 1 63 Transit Operator 



5QAl 



Total - Local 250A (2 classes) 

Laborers Union. Local 261: 

7215 General Laborer Supervisor I 

725 1 Track Maintenance Worker Supervisor I 

7458 Switch Repairer 

7514 General Laborer 

7540 Track Maintenance Worker 



Total - Local 261 (5 classes) 

Glaziers a nd Glass Workers. Local 718: 
7326 Glazier 



86 
2,218 



2,304 

3 
10 

9 
30 
38 



10 



Total -Local 718(1 class) 2 

Automotive Mechanics Union Lodge No. 1414: 

7126 Mechanical Shop and Equipment Superintendent 1 

7228 Automotive Transit Shop Supervisor I 6 

7241 Senior Maintenance Controller 1 



46 



CkiS Position Title 

7249 Automotive Mechanic Supervisor I 

7254 Automotive Machinist Supervisor I 

7264 Automotive Body and Fender Worker Supervisor I 

7306 Automotive Body and Fender Worker 

7313 Automotive Machinist 

7322 Automotive Body and Fender Worker Assistant Supervisor 

7340 Maintenance Controller 

7381 Automotive Mechanic 

7382 Automotive Mechanic Assistant Supervisor 

7387 Upholsterer 



No ofSafrry 

Srnsmvr Muni 



5 

1 

1 

29 

20 

I 

10 

101 

12 

1_ 

189 



Total - Lodge. No. 1414 (13 classes) 

Service Employees International Lnion. Local 790; 
7212 Automotive Transit Equipment Supervisor 
7454 Traffic Signal Operator 
9102 Transit Car Cleaner 
9104 Transit Car Cleaner Assistant Supervisor 



Total - Local 790 (4 classes) 

Transport Workers o f America. Local 200: 
7412 Automotive Service Worker Assistant Supervisor 

9139 Transit Supervisor 

9140 Transit Manager I 

9141 Transit Manager II 

9142 Transit Manager III 
9173 Svstems Safctv Inspector 



Total - Local 200 (6 classes) 



I 

I 
79 

6_ 

87 

5 

254 

32 

32 

17 

2_ 

342 



TOTAL NO. OF SAFETY-SENSITIVE Ml M 
EMPLOYEES 

TOTAL NO. OF SAFETY-SENSITIVE MUNI 
CLASSIFICATIONS 



3,497 
60 



47 



uj-ia-39 15.30 from = ccsf controller IDi Attachment II 

*3i?^% CITY AND COUNTY OF SAN FRANCISCO OFHCE OF THE CONTROLLER 

Edward Harrington 
Controller 

John W. Madden 
Chief Assistant Controller 



March 19, 1999 



Ms. Gloria L. Young, Clerk of the Board 

Board of Supervisors 

City Hall, Room 244 

1 Dr. Carlton B. Goodlett Place 

San Francisco, C A 94 1 02 

RE: Amendment to Memoranda of Understanding with unions representing 
employees of the Municipal Railway 

File Numbers: 99-0272, 99-0271, 99-0273, 99-0274, 99-0276, 99-0277 
99-0278, 99-0279, 99-0373, and 99-0317 

Dear Ms. Young: 

In accordance with Ordinance 92-94, I am submitting a cost analysis of amendments to the Memoranda of 
Understanding (MOUs) between the City and County of San Francisco and various unions representing 
employees of the Municipal Railway. The amendments are retroactive and cover periods beginning July 
1, 1998 and, depending on the term of the existing MOU, extending either through June 30, 2000 or 
through June 30, 2001. These amendments update the language of the MOUs with respect to the 
Employee Assistance Program (EAP), and do not modify wage rates, benefits, or contract costs. In our 
opinion, the amendments will result in minimal incremental costs to the City. 

If you have any additional questions or concerns please contact John Madden at 554-7500. 



Sincerely, 

— 'Edward M. Harrington 
Controller 



Vicki Rambo, ERD 

Harvey Rose, Budget Analyst 



' : " 7S0 ° City Hall • I Dr. Carltoo B. Goodlett PUcc • Room 316 • Sao Fraocsco CA WKE-1694 F^VX 415-S54-7466" 



48 



03/13/99 08:17 FAI 



Attachmen t III 



CLAREMONT 

behavioralVservices 



EAP Utilization for T.W.U. Local 250-A &. MUNI Miscellaneous Employees 

Submitted by Claremoot Behavioral Services 

March 12, 1999 



The following table indicates the number of EAP cases for T.W.U. 250-A Employees and 
MUNI Miscellaneous, by fiscal year. 



T.W.U. 


Miscellaneous 


Combined 


July 1, 1995 -June 30, 1996 218 


61 


279 


July 1, 1996 -June 30. 1997 167 


75 


242 


July 1, 1997 -June 30. 1998 168 


68 


236 


July 1. 1998 -March 11, 1999 i 110 


34 


144 



1050 Marina Village Parkway, Suite 203. Alameda CA SM501 » 800-788-8829 Fax 510-337*833 » www.cUrctnomeap.aw 



49 



Memo to the Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Item 15 - File 99-0280 

Note: This item was continued by the Finance and Labor Committee at its meeting 
of March 17, 1999. 



Department: 
Item: 



Description: 



Department of Human Resources 
Municipal Railway 

Ordinance implementing an amendment to Section 16 of 
the Memorandum of Understanding (MOLT) between the 
Transport Workers Union and the City and County of San 
Francisco for Local 250A, (1) to provide a maximum 
amount of $225 per month toward dependent health care 
coverage for permanent part-time employees who 
regularly work a minimum of 20 hours per payroll period, 
upon completion of one year of continuous service; and (2) 
to provide that the City will pay a portion of the 
employee's share of retirement contributions to the 
Employees Retirement System (ERS) for permanent part- 
time employees at a rate of 2.5 percent after the first six 
months of continuous service; 5 percent from six months 
to one year of continuous service; and 7.5 percent after 
one year of continuous service, effective the first full pay 
period after approval of the proposed ordinance by the 
Board of Supervisors through the duration of this MOU 
which expires on June 20, 2000. 

The MOU with Local 250A includes one classification, 
9163 MUNI Operator, comprising 1,844 employees. The 
proposed amendment to the MOU would only affect 
permanent part-time MUNI Operators, which currently 
comprise approximately 175 employees. Part-time MUNI 
operators are defined as those employees who regularly 
work a minimum of 20 hours per payroll period. 

Currently, permanent part-time MUNI operators do not 
receive any dependent health care benefits and the City's 
contribution for the employees share of retirement 
contributions to the Employees Retirement System is 2.5 
percent, regardless of their length of service. The 
proposed amendment to the MOU would result in 
permanent part-time MUNI operators receiving up to 
$225 per month for dependent health care coverage upon 
completion of one year of continuous service. In addition, 
the proposed amendment to the MOU would provide that 
the City will continue to pick up the employee's share of 
contribution to the applicable ERS retirement plan at a 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

50 



Memo to the Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

rate of 2.5 percent for the first six months of continuous 
service, after which the rate would increase to five 
percent for employees with six months to one year of 
continuous service and again to 7.5 percent for employees 
after one year of continuous service. 

According to Ms. Alice Villagomez of the Department of 
Human Resources, the proposed ordinance would result in 
permanent part-time MUNI operators receiving the same 
level of dependent health contributions and retirement 
benefits that all other permanent part-time employees in 
the City currently receive. 

Comments: 1. Section 16 of the existing MOU with Local 250A, which 

extends from July 1, 1996 through June 30, 2000, 
provides that the City and Local 250A agree to meet to 
negotiate additional health, dental and retirement 
benefits for permanent part-time MUNI operators, with 
such agreements to be implemented on the pay period 
closest to September 1, 1997. According to Ms. 
Villagomez, the reason why the proposed benefits were 
not implemented on the pay period closest to September 

1, 1997 and instead would be implemented on the first 
full pay period after the approval of this subject proposed 
ordinance is because the City wanted to wait until the 
completion of an actuarial analysis of comparable benefits 
for part-time transit operators. This actuarial analysis, 
which was not completed until August of 1998, was 
conducted by Towers Perrin Company, in connection with 
the requirement from Charter Section A8.404. This 
Charter requirement is for annual certifications by the 
Civil Service Commission of the monetary' value of 
conditions and benefits for MUNI operators as compared 
with the two transit system operators having the highest 
wage schedules. As of July 1, 1997, the two highest wage 
schedule transit operators were the Massachusetts Bay 
Transportation Authority and the Santa Clara Valley 
Authority. According to Ms. Janet Bosnich of DHR, the 
cost of the actuarial analysis by Towers Perrin Company 
was $25,000, paid through a Municipal Railway 
workorder to DHR. 

2. It should be noted that the actuarial survey conducted 
by the Towers Perrin Company found that the aggregate 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

51 



Memo to the Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



dollar value of MUNI operators retirement, vacation and 
medical benefits was $1,489,000 greater than the value of 
the same benefits that were provided to the two transit 
agencies that were certified as having the highest wage 
schedules. Therefore, the Budget Analyst questioned why, 
if MUNI transit operators are already receiving the 
highest value of retirement, vacation and medical benefits 
as compared with the two highest wage schedule transit 
systems as of July 1, 1997, that the Department of 
Human Resources would recommend the proposed 
ordinance, which would provide additional dependent 
health care and retirement benefits at an additional cost 
to part-time MUNI operators. Ms. Villagomez responds 
that although the benefit package for MUNI transit 
operators is higher than the two highest other transit 
systems, when all wage and benefit provisions in the 
MUNI transit operators MOU are taken into 
consideration, MUNI operators do not receive the highest 
overall compensation package. A comprehensive valuation 
of all the economic provisions in the collective bargaining 
agreement conducted by Towers Perrin found that MUNI 
operators are $3,514,513 below the aggregate dollar value 
of the same conditions and benefits in the two highest 
wage schedule transit systems, as of July 1, 1997. 

3. The proposed benefits would become effective the first 
full pay period following ratification of this amendment 
by the Board of Supervisors and approval by the Mayor. 

4. As shown in the attached memorandum provided by 
Ms. Peg Stevenson of the Controller's Office, 
implementing the proposed ordinance would result in 
estimated incremental costs of $147,738 for FY 1998- 
1999, based on an effective date of April 1, 1999. In FY 
1999-2000, the proposed ordinance would result in 
estimated incremental costs of an additional $450,395, for 
an approximately 7.5 percent increase above the base 
salary for these employees. Overall, the Controller's Office 
estimates the total two-year cumulative cost increase at 
$745,871. 

As noted in the Controller's analysis, these cost estimates 
are based on MUNI consistently employing a full 
complement of up to 220 part-time transit operators, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

52 



Memo to the Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

although as noted previously in this report, MUNI 
currently employs approximately 175 part-time transit 
operators. If MUNI employs fewer than the 220 part-time 
operators, the costs reflected in the Controller's estimates 
would be decreased. 

5. The Budget Analyst concurs with the Controller's 
cost estimates. 

6. The funding source for these benefit increases 
would be the City's General Fund. 

Recommendation: Approval of the proposed ordinance is a policy matter for 

the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

53 



CITY AND COUNTY OF SAN FRANCISCO 



Page - I of 2 

OFFICE OF THE CONTROLLER 



Edward Harrington 
Controller 

John W . Madden 
Chief Assistant Controller 



March 11, 1999 



Ms. Gloria L. Young, Clerk of the Board 

Board of Supervisors 

City Hall, Room 244 

1 Dr. Carlton B. Goodlett Place 

San Francisco, C A 94 1 02 

RE: Amendment to Memorandum of Understanding with TWU Local 250A 
File No. 99-0280 

Dear Ms. Young: 

In accordance with Ordinance 92-94, I am submitting a cost analysis of an amendment to the 
Memorandum of Understanding between the City and County of San Francisco and the Transit Workers 
Union Local 250A for classification 9163 Transit Operator and related trainee classifications. The 
amendment covers the period July 1, 1999 through June 30, 2000. Depending on MUNI staffing, this 
amendment can affect up to 220 part-time employees with a salary base of up to approximately S5.Z 
million. 

Based on our analysis, if MUNI consistently employs a full complement of up to 220 part-time transit 
operators, the amendment will result in incremental costs of approximately $148,000 in FY 1998-99 and 
$450,000 in FY 1999-2000. The amendment will result in a cost increase above base salaries of 
approximately 2.5% in FY 1998-99 and approximately 7.5% in FY 1999-2000. Our estimate assumes that 
mis ordinance becomes effective as of April 1 , 1 999. Please see Attachment A for specific cost estimates. 
The estimates shown here are the maximum that would result with a full roster of part-time employees — if 
MUNI employs fewer than 220 part-time operators, these costs would be decreased. 

If you have any additional questions or concerns please contact John Madden at 554-7500. 



Sincerely, 

^Edward M. Harrington 
Controller 



Vicki Rambo, ERD 

Harvey Rose, Budget Analyst 



^54-7500 



City Hall - 1 Dr. Carlton & CoodJm Place ■ Room 316 ■ S»o Fraocaco CA 94102-1694 



FAX41S-SS4-7466 



54 



MAK- 11-39 15.44 FROM'CCSF CUNTROLLEK 



Page 2 ot 2 



Attachment A 

TWU 250A Classification 9163 
Estimated Costs 1999-2000 
Controller's Office 



Annual Incremental Costs/( Savings ) 
Dependent Health Care 
Retirement Rate Increase 



FY199R.1M9 1 FY 1999-2000 

$74,682 5224,046 

73.056 226,349 



Total Estimated Incremental Costs 
Annual Amount Above 1997-98 Level 
Cumulative Total Above 1997-98 Provisions 
Incremental Cost % of Salary Base 



147.738 



450.395 



147.738 



2.53% 



598.133 

S745.871 

7 46% 



1 Assumes the amendment becomes effective April 1 . 1999 



55 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Item 16 - File 99-0410 

Note: This item was continued by the Finance and Labor Committee at its 
March 17, 1999 meeting. 



Department: 
Item: 



Description: 



Department of Human Resources (DHR) 

Ordinance fixing compensation for City employees by the 
City and County of San Francisco whose compensations 
are subject to the provisions of Section A 8.409 of the 
Charter, in classes not represented by an employee 
organization, and establishing working schedules and 
conditions of employment and methods of payment, 
effective July 1, 1999. 

The proposed ordinance would fix compensation levels 
and establish working schedules and conditions of 
employment for 99 classifications consisting of 292 
employees not represented by an employee organization. 
Of the 292 positions, 10 are management employees and 
282 are non-management employees. Such compensation 
levels and working schedules are set annually for 
Unrepresented employees, including positions designated 
as "A" or unclassified positions, and various other 
positions. Such classifications include Employee 

Relations Representative, Contract Compliance Officer, 
and Project Manager classifications. The proposed 
ordinance is for the one-year period from July 1, 1999 
through June 30, 2000. 

This report, as well as the cost analysis from the 
Controller's Office, pertains only to the fiscal provisions of 
the subject ordinance which have changed from the 
ordinance previously approved by the Board of 
Supervisors for Unrepresented employees in FY 1998-99. 
Those changes which pertain to fiscal impact from the 
proposed ordinance are as follows: 

Section 2 -Wage Rates 

The wage rates for the employees covered by this 
ordinance were increased by 2 percent effective July 1, 
1998 and by another 1.5 percent effective December 26, 
1998. The wage rates for 288 of the 292 employees 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



56 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



covered under this proposed ordinance would be increased 
by an additional 2 percent effective July 1, 1999 and 
another 1.5 percent effective December 25, 1999. 

The proposed ordinance would also increase the salary 
range for the Confidential Chief Attorney II classification 
(Classification No. AB44), covering four anticipated 
positions, by approximately 2.9 percent, from $4,188 - 
$5,090 to $4,311 - $5,241, biweekly effective July 1, 1999. 
This increases the effective annual salary to $136,790 at 
the top step for FY 1999-2000. Ms. Janet Rogers of DHR 
advises that currently, there are no employees in the 
Confidential Chief Attorney II classification, but that 
DHR anticipates four positions to fill this classification 
effective July 1, 1999. 

Furthermore, the proposed ordinance sets the wage rates 
for 22 Executive Assistant classifications (Classification 
No. AC01-AC22), effective July 1, 1999. Under the 
proposed ordinance, the wage rates for the Executive 
Assistant classifications would be increased by a total of 
1.5 percent, effective December 25, 1999. Ms. Rogers 
reports that DHR anticipates that these 22 positions, if 
filled, would be by exempt appointments. DHR is unsure 
how many of the 22 Executive Assistant classifications 
would be filled. These proposed Executive Assistant 
classifications would be designated as "A", or unclassified 
positions. Attachment I, provided by DHR, is a 
memorandum dated February 22, 1999 from DHR to the 
Controller's Office which shows that the 22 Executive 
Assistant classifications have been requested as new 
positions for inclusion in the FY 1999-2000 budget. At 
the top step, the annual salary of these positions would 
range from a low of $32,521 to a high of $145,664. 

Section 5 - Internal Adjustment Process 

The proposed ordinance stipulates that the costs of any 
internal adjustments can not exceed an annualized cost of 
0.3 percent of the total payroll cost for the employees 
covered by this ordinance. The estimated internal 
adjustment cap is $46,365 as noted in Attachment II. At 
this time, there is no specific list of classifications which 
are proposed for internal adjustments. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

57 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



Section 26 - Health and Welfare and Dental 
Insurance 

The proposed ordinance would establish two dependent 
health care packages, one for Unrepresented management 
employees, and the other for Unrepresented non- 
management employees. Presently, both management 
and non-management employees covered by this 
ordinance receive a maximum of $225 per month for 
dependent health coverage if they have dependents. 

For non-management employees with dependents under 
the proposed ordinance, the City would continue to 
contribute up to $225 for dependent health coverage 
premium costs per covered employee per month. 
However, in the event that Kaiser Health increases the 
cost of health care above the $225 maximum, the City 
would contribute up to 75 percent of the actual dependent 
medical care costs, above the flat $225 contribution. 

Management employees under the proposed ordinance 
would receive the same benefits as non-management 
employees, except that management employees would 
have the option to allocate the $225 to the Management 
Flexible Benefits Plan. The Management Flexible 
Benefits Plan, which is available to only management 
employees, gives the employee the flexibility to "purchase" 
certain benefits, such as life insurance, or to apply the 
$225 to health coverage. Under this proposal, the City 
would contribute the additional $225 per month for all 
management employees whether or not they have 
dependents enrolled in the health service system. Under 
the current ordinance, and under most MOUs, the City 
only pays up to $225 per month for employees with 
dependents. 

Section 34 - Life Insurance 

Presently, life insurance in the amount of $50,000 is 
available only to four Unrepresented Department Heads. 
The proposed ordinance would extend life insurance in 
the amount of $50,000 to the remaining 6 management 
employees. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Section 35 - Long-Term Disability 



Presently, no Unrepresented management or non- 
management employees receive long-term disability 
benefits. The proposed ordinance would make a long- 
term disability benefit available to all 282 eligible 
Unrepresented non-management employees. Eligible 
Unrepresented management employees under this 
ordinance could receive this benefit if they choose to enroll 
in the Flexible Benefits Plan. 

Eligible employees are defined as those employees who 
have completed six months of full-time continuous service 
with the City. Such employees would be eligible to 
receive a long-term (up to age 65) disability benefit equal 
to 60 percent of their salary earned at the time of 
disability, following a 180-day waiting period. 

Section 36 - Parental Release Time 

As required by the State Labor Code, all employees are 
presently allowed up to 40 non-paid parental leave hours 
to participate in the activities of a school or licensed child 
day care facility. Under the proposed ordinance, all 
employees covered by the ordinance would be granted two 
paid parental leave hours, against the 40 hours which are 
now non-paid parental leave. 

Section 38 - Severance Pay 

Presently, there is no severance pay provision for both 
Unrepresented management and non-management 
employees. The proposed ordinance would provide the 
employees in the Executive Assistant I through XXII 
classifications, who are involuntarily removed or released 
from employment with 30 calendar-days notice before the 
employees' final day of work. The employee would be 
paid, but not have to actually work during the 30 days 
after separation, therefore resulting in 30 days of 
severance pay. If the employee is not notified a full 30 
calendar-days in advance, the employee would receive pay 
for every work day less than the 30 days of notification. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

59 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

Section 39 - Grievance Procedure 

Presently, Rule 18 of the Civil Service Commission 
provides a Grievance Procedure which outlines the steps 
an employee should take in order to file a grievance, if no 
grievance procedure is set for the applicable MOU. 
However, with the passage of Proposition L, in November 
of 1993, the City adopted a new Charter section which 
created DHR. The added Section 10.103 of the Charter 
set several mandates regarding dispute resolution, 
including requiring the Director of DHR to develop a 
Grievance Procedure for Unrepresented employees. The 
Grievance Procedure in the proposed ordinance fulfills the 
requirements of Proposition L. Section 39, under the 
proposed ordinance, would establish a Grievance 
Procedure under DHR, as required by the Charter. 
According to Ms. Rogers, DHR had not fulfilled this 
November 1993 Charter mandate because it had been 
working to finalize the dispute resolution procedure in the 
MOUs. 

The proposed Grievance Procedure is comprised of three 
steps which include a written statement of grievance by 
the employee, a meeting of the employee, immediate 
supervisor, and department head, and a review of the 
written grievance by the Director of the Employee 
Relations Division. 

Comments: 1. According to Ms. Peg Stevenson of the Controller's 

Office, 292 employees would be impacted by the proposed 
ordinance. However, Ms. Rogers reports that 167 
positions, including 63 management positions and 104 
non-management positions, would be affected by the 
proposed ordinance. This report is based on the figures 
provided by the Controller's Office. 

2. As shown in Attachment II, provided by Ms. 
Stevenson, implementing the proposed ordinance would 
result in estimated incremental salary and related fringe 
benefit costs of $612,293 for FY 1999-2000 and an 
additional $141,285 for FY 2000-2001. Based on a salary 
base of approximately $15.6 million for the 292 employees 
that would be affected by the proposed ordinance, this 
would result in an increase of approximately 3.93 percent 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

60 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 

above their base salaries in FY 1999-2000 and an 
additional 0.88 percent in FY 2000-2001. 

3. The Budget Analyst concurs with the Controller's cost 
analysis. 

4. Ms. Stevenson advises that except for the Airport and 
other special fund type positions, the funding source for 
General Fund and General Fund-supported departments 
for these salary and benefit increases would be the FY 
1999-2000 General Fund Salary and Benefits Reserve. 

5. According to Ms. Rogers, the proposed Executive 
Assistant classifications, which parallel current Special 
Assistant classifications, would be created because 
departments Citywide have identified duties and 
responsibilities not covered by the existing Special 
Assistant classifications. The attached memorandum, 
Attachment III, from Mr. Geoff Rothman of DHR, 
explains the basis for the creation of these positions. 

6. Ms. Rogers reports that all other fiscal provisions not 
mentioned above would remain unchanged in FY 1999- 
2000 from what was previously approved by the Board of 
Supervisors for Unrepresented employees in FY 1998-99. 
Ms. Stevenson of the Controller's Office concurs. 

All other provisions in the FY 1998-99 ordinance for 
Unrepresented employees would remain the same for FY 
1999-2000. Such provisions would not result in 
incremental cost increases for FY 1999-2000. 

Recommendation: Approval of the proposed ordinance is a policy matter for 

the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

61 



Memo to Finance and Labor Committee 

March 24, 1999 Finance and Labor Committee Meeting 



Harve/M. Rose 7 



/ ^Kl__ 



cc: Supervisor Yee 

Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

62 



MPR 18*99 12:8? FR 



City and County of San Francisco 

February 22, 1999 
MEMORANDUM 



Tor 



Prom: 



Peg Steveeaojt 

Controller's 



Office 



Attachment I 




Department of Human RosourcM 



HUMAN MUOURCn OMECT ^| 




Subject! Km "A" Cu ases Assigned for the FY 1 999/2000 tm4gt 



The following "A" class codes have been assigned for inclusion in the FY 1999/2000 budget documeatr 



Cits* 

Code litis Department 

AC01 Executive Assistant l[ Mayor's Office 

AC02 Executive Assistant 1 1 Mayor's Office 

AC03 Executive Assistant 1 3 Mayor's Office 

AC04 Executive Assistant IV Mayor's Office 

A CO 5 Executive Assistant V Mayor's Office 

AC06 Executive Assistant VI Mayor's Office 

AC07 Executive Assistant VII Mayor's Office 

AC08 Executive Assistant VUU Mayor's Office 

AC09 ExcouUve Assistant IX Mayor's Office 

AC10 Executive Assistant X Mayor's Office 

AC1 1 Executive Assistant XI Mayor's Office 

AC12 Executive Assistant XII Mayor's Offioe 

AC13 Executive Assistant XTU Mayor's Offioe 

ACU Executive Assistant XIV Mayor's Office 

AC1 S Executive Assistant XV Mayor* s Office 

AC16 Executive Assistant XVI Mayor's Office 

AC17 Executive Assistant XVTJ Mayor's Office 

AC 18 Executive Assistant XVm Mayor's Office 

AC19 Executive Assistant: CDC Msyor's Office 

AC20 Executive Assistant XX Mayor's Office 

AC21 Executive Assistant XXI Mayor's Office 

AC22 Executive Assistant XXII Maya's Office 



7/1/99 Rate of Pav 
BWLow BWHigh 
$1030 S1246 



$1107 

$im 

$1276 
$1372 
$1467 
$1577 
$1694 
$1823 
$1970 
$2120 
$2281 
$2442 
$2627 
$2*27 
$3041 
$3273 
$3520 
$3689 
$3966 
$4270 
$4591 



$1339 
$1440 
$1547 
$1662 
$1778 
$1914 
$2058 
$2215 
$2395 
$2577 
$2772 
$2969 
$3193 
$3436 
$3696 
$3978 
$4278 
$4484 
$4821 
$5190 
$5581 



If you have any questions, please call Ana Borje-Valdea, 557-481 1. 

LM/kh 

cc: Mayor ' s Budget Director 

RooBUdow.PPSD 

Donald Mayeda, PPSD 

Geoff Rothman, ERJp 

Janet Rogers, ERD 

Janet Bosnian, ERD 

Linda Marini, MSS 

Ana Borja-Valdef, MSS 
actaaorSQ 



63 



«» TftTOI DQ.-.C at%"3 ** 



la-sa 14.43 from.ccbf controller id. Attachment 11 PACE 2/3 

x Page 1 ot 2 

% CITY AND COUNTY OF SAN FRANCISCO OFFICE OF THE CONTROLLER 

Edward Harrington 

Controller 

Job* W. Madden 
Chkf Aitwtiat ControOw 



March 18,1999 

Ms. Gloria L. Young, Clerk of the Board 

Board of Supervisors 

City Hall. Room 244 

1 Dr. Cariton B. Ooodlctt Place 

San Francisco, CA 94102 

RE: Amendment to the Unrepresented Employees Ordinance 
File No. 99-0410 

Dear Ms. Young: 

In accordance with Ordinance 92-94, I am submitting a cost analysis of an amendment to the ordinance 
fixing compensation for unrepresented employees for fiscal year 1999-2000. The amendment covers the 
period July 1, 1999 through June 30, 2000, and affects approximately 292 employees with a salary base of 
approximately SI 5.6 million. 

Based on our analysis, the amendment will result in incremental costs of approximately $612,000 in FY 
1999-2000, and $141,000 in FY 2000-2001. The amendment will result in a cost increase of 
approximately 3.9% above base salaries for FY 1999-2000. Please see Attachment A for specific cost 
estimates, 

If you have any additional questions or concerns please contact John Madden at 554-7500. 
Sincerely, 

BdwaidM. Harrington 

Controller 

*: Viclri Rambo, ERD 

Harvey Rose, Budget Analyst 



rit..n.a.ii\.«,i... » a. *.._ - 

64 



MAR-ia-BB 14.44 FROM.CC8P CONTROLLER 



'D- Attachment II 
Page 2 of 2 



AntohnwntA 
Uwtpw s nte d Employ— 
EMmitd Costs 1999-2000 
Contronefe Ofnoe 



Annual Incrsroantel Cortaflfteyingf) 

Wage Increase 2% on July 1 and 1.8% on Dm. 20 

Internal Adjustment* 

Long-Term Dteabttity Insurance 

Waga-Releted Prtng* inoraaeee 

Total Estimated Increments Costs 
Annus! Amount Above 1998-99 Live! 
Cumulative Total Abova 1998-99 Provisions 
Incramantal Coat % of Salary I 



QUflbbMOQ 


FY2W0-M91 1 


$422224 


120,911 


46.365 




57,735 




70.968 


20,374 


612.293 


141,285 


612283 


763.677 




$1,386,870 


3.93% 


0.88% 



' Amount shown Is du* to artnuanzatton of the prtor y»ar incraase 



65 



R 19*99 10: 14 FR 



415 55? 4919 TO 92520461 



;Hy and County of San Francisco 



ATTACHMENT III 



MEMORANDUM 



Date: 
To: 

From; 

RE; 



March 18, 1999 



Shirley Use 
Office of th> 



Geoff 
Employee 



Currently there are 
performed City-wide 




Department of Human Resources 



anorea fceoumMe; 

HUMAN RBSOURCBi DIRECTOR 



Budget AnalyM 
Rothrnan, Wrectoura ^y^ 



Relatione DMelMT 

'AWTft > 



EXECTIV! i ASSISTANTS 



io executive assistant classifications although these functions are 
Consequently, departments are using a variety of classes with 



different pay rates to allocate these duties and responsibilities. Examples of current 
classes include high level secretaries, management assistants, administrative analysts, 
technical managers and special assistants. For some time Apartments have expressed 
concern over the C ty-wide lack of consistency and potential inequity because there 
were no appropriate ctasefflcaticm for these functions. 



bassos 



Special Assistant 
duration. Some employees 
assistants have 
dassee were Initial*/ 
positions will resolve 
compensation equity 



were expressly created for short-term projects of limited 

In the special assistant classes who function as executive 

in these classes for longer periods than anticipated when the 

developed. Thus, the availability of the Executive Assistant 

issues regarding the appropriate use of classifications and 



Ubwbi Emouaw AMsawM 



\ Oough StrMt • tan Prancfeco, 0A M10&-12U 

66 



** TOTAL PAGE. 002 ** 




City and County ofj>an Francisco 

Meeting JVIinutes 
^Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Merman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-1689 



Wednesday, March 31, 1999 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



Meeting Convened 

The meeting convened at 10:03 a.m. 

REGULAR AGENDA 



DOCUMENTS DEPT 

JUN 1 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



990395 [Airport Concession Lease) 

Resolution approving the Post-Security Master Retail/Duty Free Concession Lease in the new International 

Terminal between DFS Group L.P., and the City and County of San Francisco, acting by and through its 

Airport Commission. (Airport Commission) 

2/25/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst: Jon Ballesteros, Airport. 

RECOMMENDED., by the following vote: 

Ayes: 2 - Yee, Bierman 

Absent: 1 - Ammiano 



990389 [Public Library Supplemental Appropriation - State Funds] 

Resolution authorizing the San Francisco Public Library to accept and expend a total of $923,493 from the 
California State Library, Public Library Foundation Program, augmenting the fiscal year 1998-1999 budget 
with a supplemental appropriation of $481,000. (Public Library) 

(Companion measure to File 990438.) 

3/8/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Virginia Minudri, Public Library. Amended 

on lines 3 and 22 to replace "$923,000" with "$481,000"; and on lines 2 and 21 to provide for retroactivity 

new title. 

AMENDED. 

Resolution authorizing the San Francisco Public Library to retroactively accept and expend a total of $481,000 

from the California State Library, Public Library Foundation Program, augmenting the fiscal year 1998-1999 

budget with a supplemental appropriation of $481,000. (Public Library) 

(Companion measure to File 990438.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 2 - Yee, Bierman 
Absent: 1 - Ammiano 



City and County of San Francisco 



Printed at 3:21 P.M on 4/1/99 



Finance and Labor Committee 



Meeting Minutes 



March 31, 1999 



990438 [Appropriation, Public Library] 

Ordinance appropriating $481,000, Public Library, of Public Library Preservation Funds, for the purchase of 
books and matenals, installation of portable shelves at the Brooks Hall, development of back-up HVAC 
system, and purchase of a new video editing system, for fiscal year 1998-1999. (Public Library) 

(Fiscal impact; companion measure to File 990389.) 

3/8/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Virginia Minudri, Public Library. 

RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Bierman 

Absent: 1 - Ammiano 



[Lease of Property) 

Resolution authorizing the lease of real property at 3801 Third Street, Suite 205, for the Department of Human 

Services. (Real Estate Department) 

3/3/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Harry Quinn, Real Estate Department. 

RECOMMENDED by the following vote: 

Ayes: 2 - Yee, Bierman 

Absent: 1 - Ammiano 



[Appropriation, Fire Department] 
Mayor 

Ordinance appropriating $2,127,526, Fire Department, from General Fund Reserve to fund the increases cost 
of providing emergency medical service (911) and for training Fire Department staff in the use of the new 
emergency communications system and automated information system and providing for the creation of 1 8 
positions for fiscal year 1998-1999. 

(Fiscal impact; Companion measure to File 990213.) 

2/8/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

3/29/99, CLERICAL CORRECTION Clerical correction from Controller's Office on page 1, line 1 and page 2, line 4 to change 

"$2,137,526" to "$2,127,526". 

Heard in Committee. Speakers: Ken Bruce, Budget Analyst's Office; Robert Demmons, Chief, Fire 
Department; Dr. Marshall Isaacs, Medical Director, Fire Department; Super\-isor Ammiano; Ed Harrington, 
Controller; Supervisor Yee; John Handley, President. Firefighters Union; Supervisor Bierman; Matthew 
Hymel. Mayor's Budget Office. Amended according to Budget Analyst's recommendations, in addition to 
placing $386. 900 on reserve; new title. 
AMENDED. 

Ordinance appropriating retroactively $1,685,431, Fire Department, from General Fund Reserve to fund the 
increases cost of providing emergency medical service (911) and for training Fire Department staff in the use 
of the new emergency communications system and automated information system and providing for the 
creation of 18 positions for fiscal year 1998-1999; placing $386,900 on reserve. 

(Fiscal impact; Companion measure to File 990213.) 
RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 3:21 PS1 on 4/1/99 



Finance and Labor Committee 



Meeting Minutes 



March 31, 1999 



(Public Employment! 
Mayor 

Ordinance amending Ordinance No. 243- 
18 positions at the Fire Department. 



(Annual Salary Ordinance, 1998-1999) reflecting the creation of 



(Fiscal impact; Companion measure to File 990212.) 

2/8/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Ken Bruce, Budget Analyst's Office; Robert Demmons. Chief Fire 

Department; Dr. Marshall Isaacs, Medical Director, Fire Department; Superi'isor Ammiano; Ed Harrington, 

Controller; Supervisor Yee; John Handley, President, Firefighters Union; Supervisor Bierman;; Matthew 

Hymel, Mayor's Budget Office. Amended to provide for retroactivity; new title. 

AMENDED. 

Ordinance amending Ordinance No. 243-98 (Annual Salary Ordinance, 1998-1999) reflecting the creation of 
18 positions retroactively, at the Fire Department. 

(Fiscal impact; Companion measure to File 990212.) 
RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



[Parking Meter Revenue Refunding Bonds] 

Resolution approving the issuance of Parking Meter Revenue Refunding Bonds (not to exceed $23,500,000) 
of the Parking Authority of the City and County of San Francisco; approving the form of, and authorizing 
execution and delivery of a continuing disclosure certificate relating to said Bonds; approving the form and 
circulation of an official statement relating to said Bonds; authorizing the payment of certain costs of issuance 
from the proceeds of such Bonds; ratifying previous actions taken in connection with the foregoing matters; 
and authorizing the taking of appropriate action in connection therewith. (Mayor) 
3/1 7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Sara Hollenbeck, Mayor's Office, Public 
Finance; Ron Szeto, Parking Authority. 
RECOMMENDED., by the following vote: 

Ayes: 2 - Yee, Bierman 

Absent: 1 - Ammiano 



(MBE/WBE/LBE Program] 
Supervisor Yee 

Hearing to consider the status of the City's Minority Business Enterprise/Women Business Enterprise/Local 
Business Enterprise (MBE/WBE/LBE) program, specifically if the departments are on track for meeting their 
goals and the status of the Human Rights Commission's implementation of a data tracking system. 
2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 
Heard in Committee. Speakers: Marie Harrison; lleen Hernandez. 
CONTINUED TO CALL OF THE CHAIR by the following vote: 

Ayes: 2 - Yee, Bierman 

Absent: 1 - Ammiano 



ADJOURNMENT 

The meeting adjourned at 11:45 a.m. 



City and County of San Francisco 



Printed at 3:21 PM on 4 1 VV 



Finance and Labor Committee 



Meeting Minutes 



March 31, 1999 



IMPORTANT INFORMATION 



LEGISLATION UNDER THE 30-DAY RULE 

Rule 5.40 provides that when an ordinance or resolution is introduced which would CREA TE OR REVISE 
MAJOR CITY POLICY, the committee to which the legislation is assigned shall not consider the legislation 
until at least thirty days after the date of introduction. The provisions of this rule shall not apply to the routine 
operations of the departments of the City or when a legal time limit controls the hearing timing. In general, 
the rule shall not apply to hearings to consider subject matter when no legislation has been presented, nor 
shall the rule apply to resolutions which simply URGE action to be taken. 

990171 [Project Labor Agreement] 
Supervisor Brown 

Resolution adopting the use of project labor agreements when contracting for the construction of significant 

public works projects. 

2/1/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/3/1999. 

3/8/99, SUBSTITUTED. 

3/8/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 4/7/1 999. 



990408 [Taxes, Application of Partial Payments] 
Supervisor Kaufman 

Ordinance amending San Francisco Municipal Code, Part III, by amending Section 6.9-7 providing that partial 
payments shall be applied first to interest, penalties and costs for that year, and the balance, if any, shall be 
applied to taxes due for that year. 

(Amends Section 6.9-7.) 

3/1/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/31/1999. 



Watch future agendas for matters. 



City and County of San Francisco 



Printed al J:! I PM on 4/1/99 



Public Library,Gov't Info. Ctr., 5 th Fir. 
Attn: Susan Horn 



■ P5f 
1 11 




CITY AND COUNTY \Qtt3stliJs) OF SAN FRANCISCO 

s 

^BOARD OF SUPERVISORS 

BUDGET ANALYST 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



TO: ^Finance and Labor Committee 

FROM: ^Budget Analyst 

SUBJECT: March 31, 1999 Finance and Labor Committee Meeting 

Item 1 - File 99-0395 



March 26, 1999DOCUMENTS DEPT. 
MAR 3 1 1999 



SAN FRANCISCO 
PUBLIC LIBRARY 



Department: 
Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

Square Footage: 



Airport Commission 

Resolution authorizing a new Concession Lease between 
DFS Group L.P., and the City and County of San 
Francisco, acting by and through the Airport Commission 
for Post-Security Master Retail/Duty Free concessions in 
the new International Terminal of San Francisco 
International Airport. 

New International Terminal of the Airport 

Concession space for the purpose of selling duty free and 
non-duty free merchandise (see Description below). 

City and County of San Francisco by and through the 
Airport Commission. 

DFS Group L.P. 

Approximately 51,914 square feet in total at 25 locations 
throughout the New International Terminal, including at 
the main building and the two boarding areas. 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



Term of Lease: 



The proposed concession lease would commence in May of 
2000 to coincide with the date on which the new 
International Terminal will open. The lease would be for 
a period of ten years, terminating in May of 2010. 



Annual Rent 
Payable by 
DFS Group L.P. to 
Airport: 



Beginning from the first year of the lease, and through 
the duration of the 10-year lease period, the annual rent 
payable by DFS Group L.P. to the Airport is the greater of 
either the Minimum Annual Guarantee of $26,100,000.08, 
subject to a Consumer Price Index (CPI) annual 
adjustment, or a percentage of gross receipts, as follows: 



Gross Receipts 

Up to and including 
$50 million 



°o of Gross Receipts 
Duty Free Non-Duty Free 

15% 12% 



$50,000,000.01 to and 
including $100 million 



20% 



14% 



Over $100 million 



25% 



16% 



Utilities and 
Janitorial Services: 



Right of Renewal: 



The Lessee will pay for the costs of all utilities and 
janitorial services. 

None. 



Tenant 
Improvements: 



Mr. Bob Rhoades of the Airport states that DFS Group 
L.P. would be required to invest a minimum of $7,787,100 
based on $150 per square foot to renovate the subject 
leased space. According to Mr. Rhoades, the tenant 
improvements would begin, at the earliest, in December of 
1999. 



Description of 
Proposed Lease: 



Under the proposed lease, DFS Group L.P would operate 
duty free and non-duty free shops at 25 different locations 
throughout the New International Terminal. These shops 
would sell a variety of merchandise including wine, 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

2 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 

cosmetics, newspapers, clothing, and sundries to those 
travelers who present their airplane ticket and passport. 
Additionally, the proposed lease requires one duty free 
site in downtown San Francisco. Currently, this shop is 
located in Union Square. 

Comments: 1. DFS Group L.P. currently has a concession lease to 

operate shops in 5 locations in the International Terminal 
and one location in Union Square. This current lease has 
a Minimum Annual Guarantee of $21,000,000 or 
$5,100,00.08 less than the Minimum Annual Guarantee of 
$26,100,00.08 for the proposed new subject lease. 
Attachment I, provided by Mr. Rhoades, identifies: (a) the 
primary companies which were previously awarded the 
duty free and non-duty free concession leases related to 
the International Terminal since 1983, and (b) the 
amount of the Minimum Annual Guarantee of such 
companies due to the Airport by each company. 

The existing lease was previously awarded by the Airport 
(Resolution No. 94-0049) to DFS Group L.P. for a three- 
year term from January 1, 1995 to December 31, 1997. 
That lease was approved by the Board of Supervisors on 
June 30, 1994 (File No. 27-94-6). The current lease 
includes a month-to-month holdover provision on the 
lease until June 1, 1998, or until the Airport Director 
determines that international passengers are to be 
handled in the New International Terminal, whichever 
comes later, stating: 

In the event that there is a delay in the Master Plan 
schedule and the new International Terminal is not 
completed during this three-year term, the Lessee may 
continue to operate on a month-to-month holdover 
under the same terms and conditions, including the 
payment of the minimum annual guarantee, until 
international passengers are handled in the new 
terminal. Lessee will be notified in writing by Director 
once this date is confirmed. 

In the event Lessee shall, with the consent of City, 
holdover and remain in possession of the demised 
premises after the expiration of the term of this Lease, 
such holding over shall not be deemed to operate as a 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



renewal or extension of this Lease but shall only create 
a tenancy from month-to-month on the same terms, 
conditions and covenants, including consideration, 
herein contained. 

2. Mr. Rhoades reports that the Airport Commission 
awarded the subject proposed new lease to DFS Group 
L.P. on February 16, 1999 (Resolution No. 99-0035). The 
Minimum Annual Guarantee of $26,100,000.08 is 
$1,100,000.08 more than the $25,000,000 minimum bid 
required by the Airport. 

3. Mr. Rhoades states that the basis of the $25,000,000 
Minimum Annual Guarantee bid as set by the Airport 
was determined, as in the past, by calculating 20-25% of 
the anticipated annual gross revenues. The anticipated 
gross revenue is formulated by projecting the number of 
travelers and spending per passenger. Attachment II 
provided by Mr. Rhoades contains the basis for the 
calculation of the required Minimum Annual Guarantee 
of $25,000,000. 

4. DFS Group L.P. was the only bidder. According to Mr. 
Rhoades, there are only two other known duty free 
operators in the world that could manage a contract of 
this size, World Duty Free which is a subsidiary of the 
British Airport Authority (BAA) company and Nuances 
which is based in Florida. Mr. Rhoades advises that 
neither of these firms submitted a bid. Both companies 
expressed some interest early in the procurement process, 
but declined to bid, according to Mr. Rhoades, because of 
the minimum investment of $7,787,100 required for this 
subject proposed new lease. The two companies cited the 
high price of real estate in downtown San Francisco and 
the Asian economic crisis as factors in their decision not 
to submit bids. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



Attachment I 



History of Primary Duty Free and Non-Duty Free 
Concession Operators 
San Francisco Airport 



Company 


Years of 
Contract 


Minimum Annual 
Guarantee 


Locations 


DFS Group L.P. for 
Duty Free and Non- 
Duty Free 


1983-1989 


$7.2 million 


International 
Terminal and 
downtown site 1 


Allders 

International, Inc. 
for Duty Free 

DFS Group L.P. for 
Non-Duty Free 


1989-1994 


$20 million 

$2.6 million 

Total $22.6 million 


International 
Terminal and 
downtown site 

International 
Terminal 


DFS Group L.P. for 
Duty Free and Non- 
Duty Free 


1994- 
present 


$21 million 


International 
Terminal and 
downtown site 



Only duty free shops are located dowtown. 



MAR-16-1999 14:27 FROM SFIA-RJS DBJ & fEMT 



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Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Items 2 and 3 - Files 99-0389 and 99-0438 



Department: 
Item: 



Amount: 
Source of Funds: 
Description: 



Public Library 

File 99-0389 : Resolution authorizing the San Francisco 
Public Library to accept and expend a total of $481,000 
from the California State Library, Public Library Fund. 

File 99-0438 : Supplemental appropriation ordinance 
appropriating $481,000 from the California State Library, 
Public Library Fund for the purchase of books and 
materials, installation of portable shelves at Brooks Hall, 
development of a back-up heating, ventilation and air 
conditioning (HVAC) system for the Main Library 
computer room and purchase of a new video editing 
system for the Main Library. 

$481,000 

California State Library, Public Library Fund 

File 99-0389 

Each year, the California State Library, Public Library 
Fund allocates funding to State-certified public libraries 
by using a per capita formula based solely on the 
population of the public library's service area. The San 
Francisco Public Library (SFPL) was previously certified 
by the State to receive $442,493 of these State funds in 
FY 1998-99. Such funds were appropriated by the Board 
of Supervisors in the SFPL FY 1998-99 budget. 

Since the Board of Supervisors approval of the SFPL FY 
1998-99 budget, the State Legislature increased the FY 
1998-99 Statewide allocation of the State Public Library 
Fund by $20 million, from $18,870,000 to $38,870,000. As 
a result, SFPL is now entitled to receive an additional 
$481,000 for the current fiscal year, which would result in 
a total allocation of $923,493 for FY 1998-99. 

This proposed resolution (File 99-0389) would authorize 
SFPL to accept and expend such additional State grant 
funds of $48 1,000. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



File 99-0438 

A description of the items to be acquired under this 

$481,000 supplemental appropriation request is as 

follows: 

$250,000 would be allocated to acquire books and 
materials, including $112,000 for the Main Library, 
$102,000 for the 26 Branch Libraries, and $36,000 
specifically for books and materials for the Children and 
Teens Sections of the Main Library and the 26 Branch 
Libraries. 

$40,000 is for a Non-Linear Video Editing System in the 
Main Library. According to Ms. Eve Sternberg of SFPL, a 
Non-Linear Video Editing System captures and digitizes 
video footage so that video programs can be edited within 
the computer. This digital cut and paste approach allows 
for more efficient video editing and instantaneous changes 
to the video program. The existing video editing system, 
operated by a nine year-old Commodore Amiga 4000 
computer, is outdated and frequently malfunctions. Ms. 
Sternberg reports that it is difficult to find technical 
service and support for the video editing equipment 
currently used by the Main Library, since the Commodore 
computer company went out of business in 1996. 

$41,000 is for a backup HVAC unit for the Main Library 
Computer Room. Presently, there is no backup HVAC 
system for the Main Library Computer Room which 
houses the SFPL mainframe computer. Without such a 
backup system, the mainframe computer, which stores 
valuable information, including records of library patrons 
and the online catalog, is at risk of failing if the HVAC 
system is unable to control the room temperature. 

$150,000 is for the cost to reinstall portable compact 
shelving, presently located on the lower level of the Old 
Main Library into space at Brooks Hall. Mr. George 
Nichols of SFPL explains that presently, the compact 
shelving installed in the old Main Library is not being 
used because the Old Main Library is being renovated 
into a new Asian Art Museum. SFPL is currently using a 
portion of space in Brooks Hall to store (a) older books, (b) 
books not-yet-catalogued, (c) special collection books, and 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

(d) archival material. However, such books and materials 
are not on shelves but are in boxes and pallets, and 
therefore, are not readily accessible for loaning out to 
Library patrons. By moving the compact shelving from 
the Old Main Library and reinstalling this shelving in 
Brooks Hall, such books and materials would become 
more accessible to the public who would be able to check 
these books out at the Main Library by requesting library 
staff to retrieve particular books and materials from the 
proposed shelves at Brooks Hall. The proposed compact 
shelving expenditure would provide an estimated 21,228 
feet of shelving to hold an estimated 212,280 books. 

Budget: A summary budget for the proposed supplemental 

appropriation from State Public Library Fund in the 
amount of $481,000 is as follows: 

Category Amount 

Books and Materials $250,000 

Portable Book Shelves 150,000 

Non-Linear Editing System 40,000 
Backup HVAC System 

for Computer Room 41.000 1 

Total $481,000 

The attachment, provided by SFPL contains a detailed 
budget and explanations to support this summary budget 
shown above. 

Comments: 1. Since $442,493 of the State grant funds were 

previously approved by the Board of Supervisors in the 
SFPL FY 1998-99 budget, the proposed resolution (File 
No. 99-0389) should be amended to authorize SFPL to 
accept and expend a total of $481,000 and not $923,493 as 
the resolution currently states. 

2. According to Mr. Nichols, SFPL has accepted the 
proposed $481,000 in State Public Library Funds prior to 
obtaining Board of Supervisors approval of this subject 
resolution because the resolution and supporting 
documents for consideration by the Board of Supervisors 



1 Total estimated cost is $44,924. According to Mr. Nichols, the balance of $3,924 ($44,924 less 
$41,000) would be paid for from non-restricted Library gift funds. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

were apparently misplaced in late January 1999. 
Therefore, the proposed resolution (File No. 99-0389) 
should be amended to provide for retroactivity. 

Recommendation: 1. In accordance with Comment No. 1, amend the 

resolution (File No. 99-G389) to authorize the San 
Francisco Public Library to accept and expend a total of 
$481,000 from the California State Library, Public 
Library Foundation Program, and not $923,493 as the 
resolution currently states. 

2. In accordance with Comment No. 2, amend the 
resolution (File No. 99-0389) to retroactively accept the 
proposed funds. 

3. Approve the proposed resolution (File No. 99-0389) as 
amended and approve the proposed ordinance (File No. 
99-0438). 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

10 



lar— 24-99 16:34 p Q2 

ATTACHMENT 



Page 1 of 5 



PUBLIC LIBRARY FOUNDATION PROGRAM (PLF) 

GRANT AUGMENTATION 

BUDGET DETAILS 

Library Books and Materials 

Main Library adult books/materials 

in subject areas of business, economics 

and political science $72,000 

Main Library standing orders and business 

services (such as annual reports, corporate 

financial statements, and other reference 

business financial information that is updated 

periodically) 40,000 

Mission Branch Library collection augmentation 

in connection with opening of renovated branch 30,000 

Oceanview Branch Library collection augmentation 

in connection with construction of new branch 1 5,000 

Foreign language materials for Branches 35,000 

Branch Library adult books/materials in subject areas 

of business, economics and political science 22,000 

Systemwide childrens/teens books and materials in 

foreign languages 14,000 

Systemwide children/teens general interest books and 

materials 22.000 

TOTAL LIBRARY BOOKS AND MATERIALS $250,000 



11 



Mar-24-99 16:34 



P . 03 

ATTACHMENT 
Page 2 of 5 



Non-Linear Editing System 

Avid Express NT deluxe board sets, software and 

Fully configured IBM Intellestation workstation, 

Realtime system with AVR 77 S26.850 

Sony 520GS 20 inch monitor 2,570 

Avid Xpress NT Keyboard S5 

Avid IS18 18BG hard drives stripped for 36 GB 

Array, 5 year overnight replacement warranty 4,500 

Puffin Commotion paint/matting software 2,385 

Whirlwind BNC01 BNC cables 50 

Avid Assurance technical support 1 ,695 

Horita BSG50 black burst generator 272 

Roland MA12CP powered audio monitors 259 

Delivery, set-up, system testing, 14 day training 1 ,034 

Tax 290 

TOTAL NON-UNEAR EDITING SYSTEM $40,000 

Backup HVAC for Computer Room 

10-ton Compu-Air Air-Cooled Computer Room 

Air Conditioning Unit 17,924 

Installation: to be carried out by Pacific Coast Trane 

Service (12B compliant, non-MBE/WBE) 

through a workorder to DPW 27.000 

Less cost to be funded by Library Gift Fund (3.9241 

TOTAL HVAC BACKUP UNIT $41 ,000 



12 



ar-24-99 16:34 

P.04 

ATTACHMENT 
Page 3 of 5 
4. Portable Compact Shelving Moving/Re-lnstallation/Book Shelving 

Moving and Re-Installation contract to be bid by 

Purchasing Department (estimate based on telephone 

quotes) $107,000 

Movement and shelving of books in compact shelving, 
Contract to be bid. Estimate based on vendor quote of 
$2.03 per linear feet of shelf space. 43,000 

TOTAL COMPACT SHELVING MOVE/INSTALL $150,000 

TOTAL PLF AUGMENTATION BUDGET $481.000 



13 



ATTACHMENT 
Paee 4 of 5 



Proposed Budget for Supplemental Appropriation from State Library PLF Funding 



Books and Materials 5250,000 

The majority of the additional PLF funding will be used to acquire books and materials. 
This includes books and materials, standing orders and business services for the Main 
Library (SI 12,000), books and materials, standing orders and business services for 
Branch Libraries (5102,000), and books and materials for Children and Teens (536,000). 

Non-linear Editins Svstem S40,000 



Tne video editing equipment currently in use in the library's Media Services unit is fast 
becoming obsolete and prone to breakdowns and crashes. The system which includes an 
integrated video graphics, titling and editing controller, resides within a Commodore, 
Amiga 4000 computer. The Commodore computer company went out of business in 
1996. Since then services and support for these machines has dropped off dramatically. 
Because the platform is not PC based, the library's computer support staff are not able to 
provide technical assistance to Media Services in support of the Commodore platform. 
Over the past year the system has experienced hard drive problems that have been 
corrected by Media Services staff with the assistance of staff from Cirywatch/Ch. 54. But 
soon the system will probably fail for good, leaving Media Services without a video 
editing system. 

Besides the Commodore systems pending demise, the system is also obsolete in its design 
as a traditional linear analog video editor. Tne system is tape based, which means a video 
program is edited on to videotape in a linear sequence. In the past few years, video 
editing technology has become digital. Non-linear 

digital video editing systems use video footage that has been captured and digitized into 
data files, which allows video programs to be edited within the computer in a cut and 
paste fashion. This digital cut and paste approach makes video editing quicker and 
allows for instantaneous changes in the edited program. Tne cut and paste method of 
video editing ismot possible in a tape based linear system. A similar analogy is the 
advent of word processing as compared to typewriters. 

A complete digital non-linear editing system is comprised of a Pentium n 333 (or better) 
MHz CPU, digital video editing software, digital video editing capture board hardware, 
multiple large hard drive data storage hardware, two 17" SVGA computer monitors, a 
20" video monitor and stereo speakers. Tne most cost-effective method of purchase for 
the Avid Express NT system is a complete turnkey package for the price of S40,000. 
This system will meet the video production needs of the library system for years to come. 
Tne Avid video editing system is the proven leader in digital non-linear editing systems 
and has become the industry standard. 

Since the system is PC based, it can be easily integrated into the library's computer 
network. 



14 



ATTACHMENT 
Page 5 of 5 



Back-Up HVAC Unit for Computer Room S41,000' 



The recent PG&E power failure nearly disabled SFPL on-line services. Our single 
computer room air conditioning unit was tripped off, and we have no back-up system. 

Computer room systems and electronics generate heat. The Computer Room air 
conditioner must control heat dissipation. A failure of the computer room coolins 
system can result in a condition known as a Thermal Runaway. 

Thermal Runaway occurs when the equipment continues to generate heat faster than it 
can be dissipated. Tne temperature will continue to rise until the equipment fails or a fire 
breaks out Some electronic components and disk drives begin to stress and fail at as low 
as 86 degrees Fahrenheit. Computer room temperature can reach 100 degrees Fahrenheit 
in as little as one hour after a cooling system failure. 

Computer room equipment replacement costs would exceed S5 million if there were to 
be a catastrophic failure or Thermal Runaway. 

*total cost is 549,0000. Balance paid from non-restricted miscellaneous gift funds. 



Portable Compact Shelving Re-Installation for Brooks Hall S150,000 

The valuable compact shelving currently installed on the lower level of the old Main 
Library Building with its tracks encased in concrete must be extracted, and moved to 
Brooks Hall. 

A false floor will be constructed at Brooks using plywood platforms covered with "place 
& press" vinyr-fiooring to facilitate cleaning. New tracks will be installed on the false 
flooring and the movable shelves will be reconnected with new hardware. In the final 
stage of this project, specified elements of the library's collection will be moved to these 
shelves bv the contractors. 



15 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



Item 4 - File 99-0434 
Department: 

Item: 

Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

No. of Sq. Ft. and 
Cost Per Month: 

Annual Cost: 



Utilities and 
Janitorial Services: 



Term of Lease: 

Right of Renewal: 
Source of Funds: 



Department of Human Services (DHS) 
Department of Real Estate (DRE) 

Resolution authorizing a new lease of real property at 
3801 Third Street, Suite 205 

3801 Third Street, Suite 205 

To obtain space for the Ruth E. Smith Foster Care 
Demonstration Project, a program established to keep 
children out of the foster care system. 

Bayview Plaza, LLC 

City and County of San Francisco 



Approximately 1,800 square feet at $1.60 per square feet 
per month, for a total of $2,880 per month. 

$8,640 for the first fiscal year of the lease from April 1, 
1999 through June 30, 1999 (three months); then $34,560 
for each of the following four fiscal years from July 1, 
1999 through June 30, 2003. 



The lessor would be responsible for utilities and janitorial 
service. 

The four-year and three-month lease would commence on 
April 1, 1999 or upon completion of the tenant 
improvements, whichever is later, and expire thereafter 
on June 30, 2003. 

The City has an option to renew the lease for one five-year 
term at 95% of the Fair Market Value 

According to Ms. Rose Chow and Mr. Christian Griffith of 
DHS, $8,640, which represents three months of rent, was 
approved for the subject lease in the DHS budget for FY 
1998-99. Approximately 36% of the $8,640 in rental costs 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

16 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 

is covered by the General Fund, with the balance provided 
by 37% Federal and 27% State funding. 

Description: The site of the proposed lease will house the Ruth E. 

Smith Foster Care Demonstration Project, which began in 
late 1998. The Project staff is comprised of a team of 
employees from various City departments, including the 
Juvenile Probation Department, and Mental Health and 
Maternal Child Health Divisions of the Department of 
Public Health. Project staff provides various sen-ices 
including mental health, substance abuse counseling, and 
community outreach. 

According to Mr. Bill Bettencourt of DHS, this integrated 
services team will serve approximately 650 families 
annually in the Bayview Hunters Point, Potrero Hill and 
Visitacion Valley areas. Mr. Bettencourt states that of 
the anticipated 650 families to be served each year, 
approximately 200 will be new to the Project. This 
neighborhood model, which includes a component that 
assists relatives caring for children whose parents are 
unable to do so, seeks to achieve positive outcomes and 
keep children out of the foster care system. 

The Project, as well as several other DHS projects, is 
currently housed in Suites 110, 210, 220, and 230 of the 
same building, 3801 Third Street, for a total of 7,715 
square feet for 40 employees. Suites 110, 220, and 230 
constitute 7,085 square feet of office space. These suites 
are leased by DHS under one lease at a monthly rental 
rate of $1.35 per square foot, or approximately $9,565 per 
month for an annual rent of $114,777. Suite 210, which is 
630 square feet, is leased separately by DHS at a monthly 
rental rate of $1.50 per square foot, or $945 per month for 
an annual rent of $11,340. 

Attachment I, provided by Mr. Bettencourt, explains the 
need for DHS to acquire new space, the current location of 
the staff to be located in Suite 205, and the purpose of co- 
locating Department of Public Health (DPH) staff. 
Attachment II, provided by Ms. Anne Okubo of DPH, 
confirms that five DPH staff would also be stationed at 
the proposed lease site. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

17 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



Comments: 



In total, DHS presently leases Suites 110, 210, 220, and 
230 for 7,715 square feet of office space at the 3801 Third 
Street site or approximately 192.9 square feet per 
employee for 40 employees, who are currently assigned to 
the Ruth E. Smith Demonstration Project and other DHS 
Family and Children's programs. The total presently 
leased office space includes conference, waiting, and child 
visitation rooms. The proposed new lease for Suite 205 
would add 1,800 additional square feet for a total of 9,515 
square feet of office space for 57 empk>3 r ees, or 
approximately 166.9 square feet per employee, for the 
Project and other DHS Family and Children's programs 
located at 3801 Third Street. Specifically, there are 17 
new staff to be located in the proposed subject new lease 
of 1,800 square feet of Suite 205, resulting in 105.9 square 
feet per employee. Of the 17 new Family and Children 
staff to be located in Suite 205, ten are directly assigned 
to the subject Foster Care Demonstration Project. 

1. Leasehold Improvements 

According to Ms. Venegas of the DRE, the lessor will pay 
for leasehold improvements at an estimated cost of 
$40,000. Such improvements include building out office 
space and internal walls, floor covering, painting, 
electricity, and heating. Leasehold improvements are 
expected to be completed 30 days of the approval of this 
resolution. 

2. Fair Rental Value 



Recommendation: 



Ms. Venegas advises that the proposed rent of $1.60 per 
square foot represents fair rental value for the property. 
The $1.35 rental rate per square foot per month for Suites 
110, 220, and 230 and the $1.50 rental rate per square 
foot per month for Suite 210 were set on March 27, 1998 
and July 11, 1998, respectively. 

Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

18 



MAR-25-1999 16=11 DEPT OF HLMPN SUCS 



ATTACHMENT I 
Page 1 of 2 



Family and Children's 
Services Division 



Memo 




To* Shirty Lee. Budget Analyst's Office 

Fran BiB Bettencourt, Deputy Director. 

Date March 24, 1999 

fte Suite 205, 3801 Third St 



Wtth increased revenue from the State Budget this year, we have recently completed raring 4S new 
staff totaL Of these staff, 25 child welfare workers are currentty in training in classrooms at 1650 Van 
Ness Ave. They also do what we call "shadowing" experienced child welfare workers a few hours each 
week, which entaib Dterafly going with them to see children and families or to go to court hearings. 
These new workers do not have work stations in any of our buildings, nor do any of our buildings haws 
the space needed to provide these work stations. 

Of these 25 workers, 7 win be going to Suite 205 at 3801 Third St. along with 1 supervisor, 1 derical 
support staff, and 1 human services technician- They are a unit that wil be part of the Ruth E Smith 
Foster Care Demonstration Project, which is a five year demonstration project 

The project is unique to San Francisco in that we win be using an integrated services team approach to 
bring to families the array of services they need, rather than having them have to wade through various 
systems in order to get those services. The project includes federal funds for this purpose arid we work 
ordered funds to DPH who has hired mental health, nursing, substance abuse and psychological 
consulting staff, a total of five, to be part of this integrated team of the project DPH simply hires for us 
under this arrangement since we do not have the expertise to hire in these fields. The staff themselves, 
however, are supervised by us, paid by us, and so wil be bcaled with us fuD-time. 

The project also provides federal funds to hire communiy outreach scaff (1) and dehcaf support (1) to 
work w8h the schools, churches, cammunty agencies, and businesses in the southeast sector of the 
city to support and coordinate with this project 

A total of seventeen (17) staff then win be located in this office: l-ChUd Weffare Supervisor; 7-Child 
Weffare Workers; 1-Human Services Technician; 1-aericaI Support Staff, 5 Integrated Services Staff 
hired by work ordering funds to DPH; 1 Community Outreach Staff and 1 Clerical Support Staff hired 
through federal project funds. 

This project is a major piece of our strategic plan to reduce the number of chldren in foster care and to 
better serve chidren and famles at-risk. The Southeast area of the cfty accounts for 25% of the 
referrals to the child welfare system. Besides the fact that we do not have any space In any of our 
existing buflcings for these staff, this project is "comrrurifry-based" and the staff need to be in space in 
the community or t wiD not work. 



• Pagel 



19 



DtPT OF HUMAN SUCS ATTACHMENT I 

Page 2 of 2 



There are additional staff in training who also do not have space in any of our buttings. We will be 
bringing forward another request for leasing space at 225 Valencia St. in the near future because we 
need additional space for these staff who have no work stations currently and none avaiabie in existing 
space. We wil provide you with the details of this staffing configuration when we present this to you as 

1 hope this provides you with the verification you need to move this forward. Feel free to contact me 
should you need further information. 



• Page 2 



TOTAL P. 03 
20 



Page 1 of 1 

City and County of San Francisco Department of Public Health 




March 25, 1999 



Harvey Rose 

Budget Analyst 

1390 Market Street, Suite 1025 

San Francisco, CA 94102 



Dear Mr. Rose: 

The Department of Public Health has a workorder to provide services for the Department 
of Human Services. This work order will fund DPH positions. 

Five of the DPH workorder positions will be housed at 3801 3 rd Street, Suite 205 for the 
Ruth E. Smith foster care demonstration project. 



Sincerely, 

Anne Okubo 
Budget Manager 



Shirley Lcc, Budget Analyst 
Christian Griffith, DHS 
Monique Zmuda 
Sai Ling Chan-Sew 



L:\H_roscdoe 

Finance 101 Grove Street Sen Francisco, CA 941 C 

TOTAL P. 01 

21 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Items 5 and 6 - File 99-0212 and File 99-0213 

Department: San Francisco Fire Department (SFFD) 

Items: File 99-0212 

Ordinance appropriating $2,127,526 to fund the increased cost 
of providing Emergency Medical Services (EMS) and for training 
Fire Department staff in the use of the new Emergency 
Communications System and Automated Information System 
and providing for the creation of 18 new positions at the Fire 
Department. 

File 99-0213 

Ordinance amending the FY 1998-99 Annual Salary Ordinance 
(ASO) reflecting the creation of 18 new H2 Firefighter positions 
in the Fire Department. 

Amount: $2,127,526 

Source of Funds: General Fund Reserve 

Description: Fire Department Justification for the Proposed 
Supplemental Appropriation 

According to a memorandum dated February 3, 1999 to the 
Finance and Labor Committee by Robert Demmons, Chief of the 
Fire Department, the purpose of this proposed supplemental 
appropriation is to: 1) provide funding for staff to increase the 
number of ambulances used to deliver Emergency Medical 
Services from 17 to 21 per day at a cost of $1,420,506 in Fiscal 
Year 1998-99 for overtime; 2) accelerate hiring of new recruits 
during FY 1998-99 at a cost of $627,020 in salaries and fringe 
benefits; 3) provide $45,000 in funding to cover the cost of 
refurbishing a portion of Fire Station 20 (located at 285 Olympia 
Way) in order to provide computer training space for the new 
E9-1-1 system; and, 4) to provide 44 portable computer work 
stations, at a cost of $35,000, that will be used to conduct the 
E9-1-1 training. 

The budget for the proposed supplemental appropriation for 
increased spending retroactive from November, 1998 (when 
advanced EMT training started) through June, 1999 is shown on 
the following page. 



Board of Supervisors 
Budget Analyst 

22 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



Budget for Proposed Supplemental Appropriation 
Permanent Salaries, Uniform $513,951 

Fringe Benefits 113.069 

Subtotal 627,020 

Overtime Salaries 1,420,506 

Other Current Expenses 45,000 

44 Computer Workstations 35.000 

Total $2,127,526 

File 99-0213 would create 18 new Firefighter positions to permit 
the accelerated hiring of new recruits so that permanent staffing 
of the four additional ambulances can be achieved during the 
1999-2000 Fiscal Year. Such increased permanent staffing are 
expected to decrease the Fire Department's reliance on overtime 
expenditures for the increased EMS service. The positions that 
are proposed and related salaries are shown in the table below. 

No. of Step 1 Step 5 

FTE (Biweekly- (Biweekly- 
Positions Classification Title Annual) Annual) 

18 H2N Firefighter SI. 544 S2.164 

S40.29S S56.480 



The annual cost of the requested 18 positions would range from 
$884,944 at Step 1, including salaries of S725,364 and fringe 
benefits of $159,580, to $1,294,864 at Step 5, including salaries 
of $1,016,647 and fringe benefits of $278,217. 

The Chief of the Fire Department states in his memorandum 
that the SFFD has experienced a 37.5 percent increase in calls 
for emergency medical sen-ices since projections were completed 
for the FY 1998-99 budget, resulting in a need to respond to an 
average of 220 calls for service per day as opposed to the original 
estimate of 160 calls for service per day. The FY 1998-99 SFFD 
budget provides for operation of 17 EMS ambulances per day, 
with Firefighter Paramedics working 24 hour shifts. Based on 
220 EMS calls per day, according to the memorandum, the 
average workload per ambulance increased from approximately 
nine calls per day to approximately 13. The national average for 
response to calls for EMS sendees is 10 calls in a 24 hour period, 
according to the SFFD. 

Board of Supervisors 
Budget Analyst 

23 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



In an effort to reduce the workload for Firefighter/Paramedics to 
a "safe and reasonable level" the SFFD decided to accelerate its 
plan to implement the Basic Life Support (BLS) tier of the 
Emergency Medical Service program, beginning January 1, 
1999. 

Currently, all SFFD EMS ambulances are staffed with two 
paramedics that provide Advanced Life Support (ALS). ALS 
treatment, which requires approximately 1,200 hours of 
paramedic training, includes advanced levels of assessment and 
treatment, and the administration of medication, including 
intravenous medication. 

The SFFD plan to implement Basic Life Support (BLS) would 
staff four additional ambulances daily using two Firefighters 
with advanced Emergency Medical Technician (EMT) training. 
BLS can be provided by individuals with Emergency Medical 
Technician (EMT) certification, which involves 120 hours of 
training and at least four hours of defibrillation training. 
(Defibrillation is a procedure used in cases of cardiac arrest, in 
which an electric shock is administered to the heart to restore 
its normal rhythm.) BLS treatment includes first aid, 
cardiopulmonary resuscitation (CPR) and defibrillation. 

By adding four additional BLS ambulances, bringing the 
average number of ambulances in daily service to 21 (with daily 
operations ranging froml9 to 23 ambulances), the workload per 
ambulance would be reduced from an average of 13 per day to 
less than 11 per day, based on the projected 220 total calls per 
day, according to the SFFD. 

The costs of implementing the BLS tier of EMS would therefore 
include advanced EMT training of 36 Firefighters on an 
overtime basis (which was conducted in November, 1998) and 
the cost of staffing the additional four ambulances for a period of 
six months. Since the Firefighters staffing the additional 
ambulances would be removed from service in Fire Suppression, 
they must be replaced, or "backfilled" by Firefighters working 
overtime, according to the SFFD. 



Board of Supervisors 
Budget Analyst 

24 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



The cost of implementing the BLS tier for six months, 
retroactive from November, 1998 through June, 1999 (advanced 
EMT training was conducted in November, 1998) is therefore 
summarized as follows: 

Overtime costs for training of Firefighters 

to provide BLS Service $ 298,624 

Cost of Staffing four additional ambulances 

(overtime pay for backfilling suppression) 1.121.882 

Total Overtime Request $ 1,420,506 

Attachment 1 to this report, from Ms. Debra Ward, Chief 
Financial Officer of the SFFD, provides an explanation for the 
$1,121,882 in overtime to staff four additional ambulances for 
six months to provide the BLS tier of EMS service. 

The SFFD is not requesting additional ambulance vehicles for 
the increased EMS service. Currently, the SFFD has a fleet of 31 
ambulances which, according to Ms. Ward, will be sufficient to 
operate 21 EMS ambulances on a daily basis while maintaining 
an adequate fleet reserve. However, due to increased ambulance 
vehicle utilization with the implementation of BLS service, 
future ambulance vehicle related costs can be expected to 
increase. Ms. Ward reports that the SFFD is requesting five new 
replacement ambulances, at a total cost of $680,000 (an average 
cost of $136,000) in its proposed FY 1999-2000 budget. 

In addition to the increased overtime costs above, the 
Department proposes to hire and train additional Firefighters, 
on an accelerated basis, so that overtime costs can be reduced as 
the four additional BLS ambulances would be staffed by 
permanent Firefighter positions. The SFFD therefore proposes 
to hire 24 Firefighter recruits beginning March 1, 1999 and 12 
additional Firefighter recruits to begin training on May 25, 
1999. The cost for the additional 24 Firefighter recruits for the 
period retroactive from March 1, 1999 to June 30, 1999 and 12 
Firefighter recruits for the period from May 25, 1999 through 
June 30, 1999 are budgeted in the proposed supplemental 
appropriation as follows: 

Permanent Salaries - Uniform $ 513,951 

Mandatory Fringe Benefits 113.069 

Total $ 627,020 

Board of Supervisors 
Budget Analyst 

25 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



Lastly, the SFFD states that, in order to prepare for the 
implementation of the new E-9-1-1 s3 T stem, the Department will 
be required to train current staff on the operations and features 
of the new call taking and dispatch functions as well as the 
Records Management System within the next few months. 
Implementation of the new system is anticipated in November, 
1999. In order to do so, the SFFD proposes to use four training 
sites, including three existing training sites and a new training 
facility to be constructed at Fire Station 20. The proposed 
supplemental appropriation requests $45,000 for refurbishment 
of a training area comprising 1,100 square feet in Station 20 and 
$35,000 to purchase 44 training work stations at a cost of 
approximately $795 per work station. 

Attachment 2 to this report, provided by Ms. Ward, details the 
proposed budgets for the Fire Station 20 refurbishment in the 
amount of $35,145 ($9,855 less than the requested $45,000) and 
44 computer work stations for four training classrooms at a cost 
of $36,226, or $1,226 more than the requested $35,000. 



Analysis 



The ongoing, annualized cost of this proposed supplemental appropriation 
will exceed $2.59 million. 

The SFFD reports that a total of 36 new Firefighter positions 
will be required to staff the four additional EMS ambulances per 
day for twelve months. This proposed supplemental 
appropriation requests 18 additional Firefighter positions. 
Accordingly, the SFFD will be requesting 18 additional new 
Firefighter positions for the period July 1, 1999 through June 
30, 2000 in the FY 1999-2000 budget. 

At the top salary step, the annual ongoing cost of 36 new 
Firefighter positions, at current salary rates will be $2,589,728 
including Mandatory Fringe Benefits. There will also be 
incremental costs for materials and supplies and other non- 
salary expenditures. 



Board of Supervisors 
Budget Analyst 

26 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



Projected Fire Department Deficit 



Based on the Controller's latest monthly projections, prepared 
March 1, 1999, the SFFD will overspend its General Fund 
original budget by $2,331,631, and will overspend its revised 
budget by $2,317,411 as shown in the table below. The Budget 
Analyst concurs with the Controller's estimate. 

Controller's Projected SFFD FY 1998-99 Budget Deficit 

Surplus/ Surplus/ 

(Deficit) (Deficit) 

Controller's Compared to Compared to 

Original Revised Year End Original Revised 

Budget Budget Projection * Budget Budget 



Permanent Salaries 5101,916.337 S97,S07,369 $99,492,561 

Temporary Salaries 37.224 37,224 380,656 

Premium Pay 2,107,854 2.107,854 3.319,934 

Overtime 3,095,629 7,215.686 6,495,847 

Holiday Pay 5,290,587 5.290,587 5,496,784 



S2.423,776 S(1.685,192) 

(343,432) (343,432) 

(1,212,080) (1,212,080) 

(3,400,218) 719,839 

.:<:i6,197) (206,197) 



Fringe Benefits 17.193.731 17.196.862 16.787.211 406.520 409.651 

Total S129,641,362 S129.655.582 S131.972.993 S(2,331,631) $(2,317,411) 

* Controller's projections are based on year to date expenditures and continued spending at 
the same rate as the actual expenditures in the last pay period available (pay period 
ending 2/19/99). 

The Airport will increase funding for Fire Department Services it receives 
and therefore decrease the deficit projection. 

The SFFD reports that a large portion of the Controller's 
projected deficit is due to the fact that the SFFD General Fund 
budget has been subsidizing services to the San Francisco 
International Airport (SFIA). The SFFD has provided the SFIA 
with more fire suppression and EMS staff than currently 
budgeted in the Department's SFIA funded program budget. 
Such increased staffing for the SFIA has been provided on an 
overtime basis. The projected amount of the General Fund 
SFFD deficit that is attributable to the SFIA in FY" 1998-99 is 
$1,251,406 according to Ms. Ward. The Budget Analyst has 
confirmed with Mr. Marcus Perro, SFIA Budget Director, that 



Board of Supervisors 
Budget Analyst 

27 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

the SFIA has agreed to reimburse the SFFD for such services by 
transferring surplus SFIA funds to the SFFD. 

When this transfer of SFIA is completed, the projected SFFD 
General Fund deficit would be reduced by $1,251,406 from 
$2,317,411 to $1,066,005. 

The Fire Department has increased the number of EMS ambulances 
staffed on a daily basis and increased spending without first obtaining 
Board of Supervisors approval. Therefore, even if this level of service is 
totally reversed for the remainder of the current 1998-99 Fiscal Year, some 
portion of the projected Fire Department budget deficit is unavoidable. 

The SFFD began training Firefighters for implementation of the 
BLS tier of EMS services in November, 1998. Additional BLS 
ambulances were put into service in December, 1998 and the 
four additional ambulances were fully operational beginning in 
early January, 1999 according to Mr. Richard Shortall, Chief of 
Emergency Medical Services. 

Since January, 1999, the SFFD has therefore been incurring 
overtime expenditures for operation of the four additional BLS 
ambulances with the knowledge that such an action would 
result in the SFFD overspending its budget without Board of 
Supervisors approval of a supplemental appropriation. 
According to Mr. Matthew Hymel, the Mayor's Director of 
Finance, the Mayor's Office approved of the SFFD plan for 
increased service and agreed to forward the supplemental 
appropriation to the Board of Supervisors. 

Since the SFFD has already incurred expenditures related the 
increased EMS service as proposed in this supplemental 
appropriation, for approximately three months of the six month 
period that would be funded, the Department would face a year 
end budget deficit even if the Board of Supervisors disapproved 
the proposal to fund the implementation of the BLS tier of EMS 
service. 



Board of Supervisors 
Budget Analyst 

28 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



Implementation of the plan to transfer EMS responsibility from the 
Department of Public Health to the Fire Department in Fiscal Year 1996-97 
has clearly resulted in increased spending for EMS service as was 
previously projected by the Budget Analyst. However, the number of 
Paramedics available to provide EMS service has been reduced and the 
number of Paramedic Supervisors has been increased significantly. The 
SFFD maintains that there has been an overall increase in the number of 
personnel providing EMS service in the field at all times. 

In April, 1997, the Board of Supervisors approved a 
supplemental appropriation of approximately $1.6 million and 
related legislation to transfer responsibility for EMS services 
from the Department of Public Health to the SFFD. The plan to 
do so was documented in a report prepared by the DPH 
Emergency Medical Services Agency, that continues to have 
regulatory and oversight responsibility for EMS services. The 
February 1996 EMSA report, "Optimizing the Configuration of 
San Francisco's Emergency Medical Services," summarized the 
reasons for the proposed changes to the EMS system as follows: 
(1) to ensure faster response times for emergencies throughout 
the City; (2) to use resources more cost-effectively through 
careful targeting of emergency services to emergency needs; (3) 
to offer better emergency service to all neighborhoods, 
particularly those that are currently underserved; and (4) to 
eliminate wasteful duplication of services. 

The EMSA report described the transition of EMS from DPH to 
SFFD responsibility as "cost-neutral". However, in April, 1997 
the Budget Analyst reported to the Board of Supervisors that 
costs would increase by as much as $1.0 million annually, not 
including future salary increases, due to increased supervisory 
positions (which were offset by a reduction in Paramedic 
positions) and cross training of Firefighter/Paramedics. 

The SFFD's implementation of the EMS transition was reflected 
in the FY 1998-99 budget. The table below shows the former 
DPH positions that were eliminated and the SFFD positions 
that were created. 



Board of Supervisors 
Budget Analyst 

29 



HI 


156.5 


H33 


28 


H43 


5 


H53 


1 




191.5 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

DPH EMS Positions Deleted and SFFD Positions Created 

Annual 
Class Number Salary Position Budget Amount 

Positions Deleted 

2532 169 S 60,108 Paramedic $(10,073,892) 

1819 1 64,989 Mgt. Information Specialist (64,602) 

2530 1 64,676 Senior Medical Steward (64,233) 

2534 13 71,305 Paramedic Supervisor (920,580) 
2529 1 70,079 Assistant Chief, Paramedic Division (69^574) 

2531 1 75,742 Deputy Chief, Paramedic Division (75,813) 

2535 _1 83,494 Chief, Paramedic Division (83.604) 
187 Total Positions Eliminated 5(11,352,298) 

Positions Created 

$62,327 Fire Rescue Paramedic $9,641,344 

74,881 Captain -EMS 2,081,487 

89,888 Section Chief- EMS 445,979 

103,930 Chief, Emergency Medical Services 100.355 

Total Positions Created $ 1 2,269, 1 65 

The Budget Analyst notes that the SFFD's implementation of 
the EMS transition plan was consistent with the plan reported 
to the Board of Supervisors in April, 1997. 

The table above shows that there are currently 12.5 fewer 
Paramedic positions providing EMS service under the SFFD 
than the number of positions under DPH, and that there has 
been a large increase in supervisory positions. Specifically, 
under DPH, there were 13 Paramedic Supervisor positions. 
Currently, under the Fire Department, supervision of Fire 
Rescue Paramedics is provided 28 Captains positions. This 
represents an increase of 16 supervisory positions or 115 
percent. This increase in supervision was part of the plan as a 
means of correcting understaffing of Paramedic Supervisors 
under the Department of Public Health. According to EMS Chief 
Shortall, Paramedic Captains are available, and do provide 
Paramedic services whenever required. Other factors such as 
the 24-hour shift for Paramedics and less down time during shift 
changes, according to Chief Shortall, actually result in an 
increased availability of personnel at all times. 



Board of Supervisors 
Budget Analyst 

30 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Compared to the cost of EMS services under the DPH, the cost 
for Paramedic and EMS related salaries, as shown in the table 
above have increased by $916,867, plus approximately $156,000 
in related increased fringe benefit costs, for a total increased 
cost of $1,072,867. The reasons for this increased costs are 
higher salary levels for all positions, a 115 percent increase in 
the number of supervisory personnel, and higher paid top 
management positions. 

The EMSA plan did not discuss the minimum required number 
of Paramedics to meet the demand for EMS service. The plan 
presented data that the DPH Paramedics were averaging 170 
dispatches per day. According to EMS Chief Richard Shortall, all 
discussions during formulation of the plan referred to an 
average of 160 calls per day. However, this number of calls 
disagrees with data compiled by the EMSA. This discrepancy is 
examined further below. 

Based on comparisons with historical data that is described as unreliable 
by EMS management and the EMSA, Emergency Medical Service calls for 
service, and related transports do not appear to have increased 
dramatically since the transfer of EMS responsibility from the DPH to the 
Fire Department. Moreover, the SFFD's own data show that calls for EMS 
service and total dispatches of EMS service have been relatively level over 
the last 13 months since January, 1998. 

However, Fire Department practices and dispatch policies have resulted 
in a higher number of total dispatches of EMS ambulances. Reportedly, 
under Fire Department management of EMS, all calls for service are 
responded to more quickly, there are much fewer related lawsuits against 
the City and citizen complaints have decreased significantly. 

In order to examine trends in EMS activity and workload since 
the transfer from DPH to SFFD, the Budget Analyst requested 
comparative data from the Department of Public Health's 
Emergency Medical Services Bureau (EMSA), the Agency 
responsible for oversight and regulation of the SFFD EMS 
Division. 

In response, we received data for calendar years 1996 and 1998 
from EMSA for total calls for EMS sen-ice and total transports 
of patients to medical facilities by EMS. We also requested data 
for 1998 from the SFFD EMS Division. These data are presented 
in the table below. We found that, based on these data sources, 

Board of Supervisors 
Budget Analyst 

31 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

there has been only a one half of one percent increase in calls for 
service for the two calendar years, and that patient transport 
activity has increased by 11.6%. 

Data submitted by SFFD EMS show that for Code 3 calls (calls 
involving either life threatening situations or medical conditions 
that require an immediate response), the ambulance response 
time for 90 percent of the calls has declined from 15.85 minutes 
in January, 1998 to 11.93 minutes in December, 1998, an 
improvement of 24.7 percent. 

For Code 2 calls, which involve do not require an immediate 
ambulance response, the ambulance response time for 90 
percent of the calls has declined from 39.68 minutes in January, 
1998 to 24.23 minutes in December, 1998, an improvement of 
38.9 percent. 

We have been cautioned by both Dr. John Brown of the DPH- 
EMSA and Dr. Marshall Isaacs, Medical Director of the SFFD 
EMS Division that the 1996 data provided by the DPH is of 
suspect reliability and that, according to Dr. Brown and Dr. 
Isaacs, there has been significant increases in EMS service 
demand over the last two years. 

Comparative Call for EMS Service and Transport Activity 1996 vs. 1998 

Total Calls for Service Transports to Medical Facilities 





SFFD -1998 


DPH -1996 


SFFD -1998 


DPH 1996 


January 


6,117 


6,028 


4,206 


3,665 


February 


5,072 


5,484 


3,541 


3,301 


March 


5,695 


5,932 


3,996 


3,621 


April 


5,459 


5,764 


3,719 


3,505 


May 


5,720 


5,726 


3,984 


3,524 


June 


5,562 


5,820 


3,868 


3,448 


July 


5,698 


5,749 


3,795 


3,501 


August 


5,512 


5,956 


3,816 


3,610 


September 


5,569 


5,105 


3,887 


3,409 


October 


6,055 


5,400 


4,139 


3,616 


November 


5,691 


5,880 


3,936 


3,644 


December 


6.383 


5.307 


4.453 


3.569 




68,533 


68,151 


47,340 


42,413 



Source: 



1998 Data - SFFD EMS Division; 

1996 Data - DPH Bureau of Emergency Medical Services 



Board of Supervisors 
Budget Analyst 

32 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



In contrast to the 68,151 calls shown for 1996 in the table above, 
Dr. Brown has provided documentation that the EMSA report 
issued in February, 1996 used 1994 and 1995 data that 
enumerated 62,368 and 64,287 calls respectively. 

The SFFD EMS data for total dispatches, total EMS calls for 
service and average daily ambulance activity is presented in the 
table below. 

SFFD EMS Ambulance Dispatch and EMS Call Data 
January 1998 through January 1999 









Total 


Total 




Total 


EMS Calls 




Total 


Total EMS 


Dispatches 


EMS Calls 


Number of 


Dispatches Per 


Per 




Dispatches 


Calls 


Per Day 


Per Day 


Ambulances 


.Ambulance 


Ambulance 


January 


6,974 


6,117 


225.0 


197.3 


16 


14.1 


12.3 


February 


7,787 


5,072 


278.1 


181.1 


16 


17.4 


11.3 


March 


6,538 


5,695 


210.9 


183.7 


16 


13.2 


11.5 


April 


6,204 


5,459 


206.8 


182.0 


16 


12.9 


11.4 


May 


6,818 


5,720 


219.9 


184.5 


16 


13.7 


11.5 


June 


6,567 


5,562 


218.9 


185.4 


16 


13.7 


11.6 


July 


6,788 


5,698 


219.0 


183.8 


17 


12.9 


10.8 


August 


6,521 


5,512 


210.4 


177.8 


17 


12.4 


10.5 


September 


6,382 


5,569 


212.7 


185.6 


17 


12.5 


10.9 


October 


7,113 


6,055 


229.5 


195.3 


17 


13.5 


11.5 


November 


6,381 


5,691 


212.7 


189.7 


17 


12.5 


11.2 


December 


7,143 


6.3 S3 


230.4 


205.9 


20 


11.5 


| 3 


Total- 1998 


81,216 


68,533 


222.9 


187.7 




13.4 


11.2 


January, 1999 


7,061 


6,223 


227.7 


200.7 


21 


10.6 


9.6 


Source: SFFD Emereencv Medical Senices 











Total ambulance dispatches shown in the table above 
consistently exceeds total EMS calls for sen-ice by an average of 
18.5 percent. This is because the SFFD routinely dispatches 
ambulances to non-EMS calls, such as fires, on a standby basis. 
When EMS was under the Department of Public Health, the 
SFFD called for an ambulance for a fire only if one was needed 
and the call was counted as a call for service by DPH EMS. This 
practice has therefore significantly increased the number of 
ambulance dispatches on a daily basis. Other reasons for this 
relationship include duplicate ambulance dispatches (where 
more than one ambulance is sent on the same call for EMS 



Board of Supervisors 
Budget Analyst 

33 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



service) and responses to multiple injury accidents. Chief 
Shortall points out that improved dispatching has resulted in a 
declining incidence of duplicate ambulance dispatches. 

Based on the table shown above, total dispatch and total calls 
for EMS service per day has displayed little in the way of 
increase between January, 1998 and January, 1999. The SFFD 
states that their FY 1998-99 budget was based on total dispatch 
activity of approximately 160 calls per day. However, the SFFD 
EMS data displays that they had been operating at much higher 
levels since at least January, 1998. 

According to EMS Chief Shortall and EMS Medical Director 
Isaacs, the SFFD's Criteria Based Dispatching (CBD) policies 
and practices result in a higher number of actual ambulance 
dispatches and vastly improved response times to lower priority 
calls for sendee. Previously, the DPH would often "hold" low 
priority, non-life threatening calls for long periods of time. 
Consequently, callers would often find alternative medical 
assistance and an ambulance dispatch would not be required. 
CBD policies and practices therefore clearly result in a higher 
level of service to all callers for EMS services and result in a 
greater number of ambulance dispatches in relation to the 
number of EMS calls for service. 

According to Dr. Isaacs, the CBD policies and practices have not 
only improved service, but also improved the quality of medical 
treatment and greatly reduced the likelihood of an inappropriate 
medical response to calls that may seem to be of a low priority. 
Medical lawsuits and claims against the City have therefore 
decreased according to Dr. Isaacs. Dr. Isaacs states that during 
the 18 month period from January, 1996 through June, 1997, 
when EMS was under the DPH, 17 such claims were filed 
against the Chw. For the 21 months since July, 1997 (since EMS 
was placed under the SFFD) 10 EMS related claims have been 
filed. Dr. Isaacs reports that after EMS review, he has 
recommended that seven of those claims have no merit and 
should be denied by the City, two are extremely minor and one 
is currently under litigation. Also, according to Dr. Isaacs, EMS 
quality control and risk management is highly developed and a 
detailed medical quality assurance plan has been approved by 
the EMS Medical Director, the Director of Health and the Chief 
Executive Officer of the Community Health Network, 
representing San Francisco General Hospital. 

Board of Supervisors 
Budget Analyst 

34 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



Paramedic morale has improved with the staffing of four additional 
ambulances on a daily basis and consequent reduction in Paramedic 
workload. 

The decreased workload resulting from the staffing of additional 
ambulances has improved Paramedic morale, according to EMS 
Chief Shortall and Dr. Isaacs. Ms. Ward of SFFD states that, for 
the first six months of FY 1998-99, Paramedic absenteeism due 
to sick leave and temporary disability was at a high level. 
Consequently, the EMS Division incurred overtime expenditures 
of $525,000 for just the first six months of the Fiscal Year, when 
the EMS overtime budget for the entire Fiscal Year $297,339. 
The SFFD anticipates that Paramedic absenteeism and 
overtime expenditures will decrease due to the improvements to 
the average workload. 

EMS Chief Shortall states that a return to the reduced number 
of daily ambulances in order to reduce EMS spending would 
result in a reduced level of EMS service and the negative effects 
of an increased Paramedic workload. 



Budget Analyst 
Recommended 
Amendments and 
Reductions to 
the Proposed 
Supplemental 
Appropriation 
Ordinance: 



1. Because this proposed supplemental appropriation is 
intended to fund increased EMS staffing and ambulance 
availability, and because the SFFD has already implemented 
such increased staffing (beginning in January, 1999) and hired 
additional recruit Firefighters, effective March 1, 1999, the 
proposed ordinances should be amended for retroactivity. 



2. The Budget Analyst has calculated the permanent salary 
and fringe benefit requirement as shown below: 

24 H2 Firefighter Recruits Hired March 1: 

$1,544 biweekly for 11.1 pay periods $411,322 

12 H2 Firefighter Recruits beginning May 25: 

$1,544 biweekly for 2.1 pay periods 38.909 

Subtotal - Salaries $450,231 
Fringe Benefits 99.050 

Total $549,281 



Board of Supervisors 
Budget Analyst 

35 



To 


Savings 


$450,231 


$63,720 


99,050 


14.019 


$549,281 


$77,739 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Therefore, the requested amount of $627,020 for permanent 
salaries - uniform and fringe benefits should be reduced by 
$77,739 by amending the proposed supplemental appropriation 
as follows: 

From 
Permanent Salaries — Uniform $513,951 
Fringe Benefits 113.069 

Total $627,020 

3. As noted above, the Controller's latest SFFD General 
Fund deficit projection is $2,317,411. However, as also noted, 
the SFFD reports that $1,251,406 of this amount is attributable 
to the services provided to the SFIA, and that the SFIA has 
agreed to reimburse the SFFD for this amount. Therefore, the 
current revised projected SFFD General Fund deficit is 
$1,066,005 ($2,317,411 less $1,251,406). 

The Controller's latest projection includes all pay periods 
through February 19, 1999. Therefore, the increased spending 
due to advanced EMT training provided to Firefighters and 
approximately six weeks of increased overtime spending due to 
the addition of four ambulances (which began in December, 1998 
and was fully implemented in January, 1999) is reflected in the 
Controller's projection. 

Therefore, the SFFD request for increased overtime 
expenditures can be reduced to reflect the current revised deficit 
projection. The supplemental appropriation request for overtime 
can therefore be reduced by $354,501 (from the requested 
amount of $1,420,506 to $1,066,005). 

4. The proposed supplemental appropriation requests 
$45,000 for refurbishment of Station 20 to conduct E-9-1-1 
training. However, as shown in Attachment 2, the amount 
required, based on estimates provided by the Department of 
Public Works, the required amount for this work is $35,145. 
Therefore, the request for Other Current Expenses can be 
reduced by $9,855 (from $45,000 to $35,145). 

5. The recommended reductions detailed above will result in 
an overall reduction to the proposed supplemental appropriation 
of $442,095 (from $2,127,526 to $1,685,431). 



Board of Supervisors 
Budget Analyst 

36 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Summary: • The purpose of the proposed $2,127,526 supplemental 

appropriation is primarily to provide funding for staff to 
increase the number of ambulances used to deliver 
Emergency Medical Services from 17 ambulances to an 
average of 21 ambulances per day. A total of 18 new 
Firefighter positions would be added. The SFFD 
commenced training personnel for this increase in 
November, 1998 and implemented the increased 
deployment of ambulances in January, 1999, with the 
approval of the Mayor's Director of Finance, without first 
obtaining Board of Supervisors approval. Therefore, even if 
this level of service is totally reversed for the remainder of 
the current 1998-99 Fiscal Year, some portion of the 
projected Fire Department budget deficit is unavoidable. 

• The ongoing, annualized cost of this proposed supplemental 
appropriation will exceed $2.59 million. 

• The Controller's projected SFFD General Fund deficit for FY 
1998-99 is currently $2,317,411. However the Airport will 
reimburse the SFFD $1,251,406 of this amount, thereby 
reducing the projected deficit to $1,066,005. 

• Implementation of the plan to transfer EMS responsibility 
from the Department of Public Health to the Fire 
Department in Fiscal Year 1996-97 has clearly resulted in 
increased spending for EMS service as was previously 
projected by the Budget Analyst. In 1997, the Budget 
Analyst projected that the transfer of EMS responsibility of 
at least $1.0 million annually. 

• The number of Paramedics available to provide EMS service 
has been reduced by 12.5 positions in the transfer from DPH 
to SFFD and the number of Paramedic Supervisors has been 
increased significantly, from 13 Paramedic Supervisors to 
28. The SFFD maintains that there has been an overall 
increase in the number of personnel providing EMS service 
in the field at all times. 

• Compared to the cost of EMS services under the DPH, the 
cost for Paramedic and EMS related salaries have increased 
by $916,867, plus approximately $156,000 in related 
increased fringe benefit costs, for a total increased cost of 
$1,072,867. The reasons for this increased costs are higher 
salary levels for all positions, a 115 percent increase in the 

Board of Supervisors 
Budget Analyst 

37 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 



number of supervisory personnel, as noted above, and 
higher paid top management positions. 

Based on comparisons with historical data that is described 
as unreliable by SFFD-EMS management and the DPH 
Bureau of Emergency Medical Services, calls for service, and 
related transports do not appear to have increased 
dramatically since the transfer of EMS responsibility from 
the DPH to the Fire Department. DPH-EMSA data show 
total 1996 calls for service of 68,151 while SFFD data show 
total 1998 calls for service of 68,533. The SFFD maintains 
that the historical DPH data is inflated. Moreover, the 
SFFD's own data show that calls for EMS service and total 
dispatches of EMS service have been relatively level over 
the last 13 months since January, 1998. In January, 1998, 
the SFFD dispatched ambulances 6,974 times and received 
6,117 calls for EMS service. In January, 1999, the SFFD 
dispatched ambulances 7,061 times and received 6,223 calls 
for EMS service. 

However, Fire Department practices and dispatch policies 
have resulted in a higher number of total dispatches of EMS 
ambulances in relation to total EMS calls for service. For 
example, the SFFD routinely dispatches ambulances to fire 
scenes on a standby basis. This was not the practice when 
EMS was under the DPH. 

Reportedly, under Fire Department management of EMS, 
all calls for service are responded to more quickly, there are 
much fewer related lawsuits against the City and citizen 
complaints have decreased significantly. 

Paramedic morale has improved with the staffing of four 
additional ambulances on a daily basis and consequent 
reduction in Paramedic workload. 

The Budget Analyst recommends total reductions to the 
supplemental appropriation request for uniform salaries, 
fringe benefits, uniform overtime pay and other current 
expenditures in the amount of $442,095. 



Board of Supervisors 
Budget Analyst 

38 



Memo to Finance Committee 

March 31, 1999 Finance Committee Meeting 

Recommendations: 1. Amend the proposed Supplemental Appropriation 
Ordinance and Amendment to the Annual Salary Ordinance to 
provide for retroactivity. 

2. Reduce the requested expenditures in File 99-0212 from a 

total by $442,095 from $2,127,526 to $1,685,431 by amending the 
proposed supplemental appropriation ordinances as follows: 









Budget Analyst 








Recommended 




From 


To 


Savings 


Permanent Salaries - Uniform 


$513,951 


$450,231 


$63,720 


Fringe Benefits 


113,069 


99,050 


14,019 


Overtime 


1,420,506 


1,066,005 


354,501 


Other Current Expenses 


45.000 


35.145 


9,855 


Total 


52,127,526 


$1,685,431 


$442,095 



Ms. Debra Ward, Chief Financial Officer of the SFFD, agrees 
with the recommended reductions of the Budget Analyst. 

3. Approval of the proposed ordinances, as amended, is a 

policy matter for the Board of Supervisors. 



Board of Supervisors 
Budget Analyst 

39 



Attachment 1 



2 « 



'- • 3 

O CO 



o 
2* E co 

CD 3 

00 

CD «o 

CD "5 * 



^2 

= LU 
5 TJ 
I— s 

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m 


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o»= £ -a P > „. 

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?jt|EE = =.-5 

-LJ.3O333T3f0 

cnmooz2LL<S 

^"cM'co'^'iJrto'^oo 



Source: San Francisco Fire Department 



40 



Attachment 2 



Budget for Renovation of Station 20 
Item 



Subtotal 



Total 



Amount 



Construction of flooring 






2 DPW carpenters @24 hours each 






Base Salary S36.10/hour 


S 


1.733 


Fringe Benefits 




678 


Construction Materials 




2,350 


Carpeting 120yds @ S28/yd 




3,360 


Subtotal 


S 


8,121 


Electrical and HVAC 






Wiring for computer terminals 






and lighting 






2 Electricians @ 16 hours each 






Base Salary $45.13/hour 


S 


1.444 


Fringe Benefits 




611 


Wiring materials 




2,450 


HVAC ductwork and heater units 




18,000 


Subtotal 


s 


22,505 


Tax on materials 


s 


694 


Subcontractor OH&P (15% of M&L) 




676 


General Contractor OH&P (15% of M & L) 




1.291 


5% of Sub Contractor's Cost (GC's 5 %) 




1.169 


Bond 




689 



S 4.519 



$ 35.145 



Information provided by Department of Public Works Bureau of Construction Management 

Budget for Furniture for the four Computer Training Classrooms 



Computer Desks 
Computer Lab style Tables 
Ergonomic Task Chairs 
Brackets for CPU 



14 @ $720/ desk 
6@$1,120/table 
44 @ S265/chiar 
44@S112/Bracket 



Subtotal 
Tax @ 8.5% 

Total 
Estimates are based on the research done by the SFFD 9-1-1 Coordinator 



S 10,080 

6.720 

1 1 ,660 

4,928 

S 33.388 
S 2,838 
S 36.226 



Source: San Francisco Fire Department 



41 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 

Item 7 - 99-0530 



Department: 



Item: 



Amount: 
Description: 



Parking Authority- 
Mayor's Office of Public Finance 

Resolution (a) approving the issuance of Parking Meter 
Revenue Refunding Bonds by the Parking Authority, to 
partially refinance bonds issued in 1994, which funded 
the construction, acquisition and equipment for four City- 
owned off-street parking facilities in the City, (b) 
approving the form of and authorizing the execution and 
delivery of a continuing disclosure certificate relating to 
said bonds, (c) approving the form of and circulation of an 
official statement relating to said bonds, (d) authorizing 
the payment of certain costs of issuance from the proceeds 
of such bonds, (e) ratifying previous actions taken in 
connection with the foregoing matters, and (f) authorizing 
the taking of appropriate actions in connection therewith. 

Not to exceed $23,500,000 

In 1994, the Parking Authority issued $25,000,000 in 
Parking Meter Revenue Bonds to finance the 
construction, acquisition and equipment for four City- 
owned off-street parking faculties in the City. The 
Attachment, provided by the Mayor's Office of Public 
Finance, identifies the four City-owned off-street parking 
facilities and their locations. According to Ms. Sarah 
Hollenbeck of the Mayor's Office of Public Finance, the 
remaining principal amount of debt from this $25,000,000 
bond issuance will be $23,635,000 as of May 1, 1999. Ms. 
Hollenbeck advises that $4,255,000 of the $23,635,000 in 
outstanding debt cannot be refinanced. The amount that 
will be refinanced therefore will be $19,380,000 
(outstanding debt of $23,635,000 less $4,255,000). 

Approval of this resolution would authorize the Parking 
Authority to issue tax exempt Parking Meter Revenue 
Refunding Bonds, Series 1999-1, in an amount not to 
exceed $23,500,000, in order to refinance $19,380,000 of 
the remaining principal amount of debt of $23,635,000 on 
the 1994 Parking Meter Revenue Bonds. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 



42 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 

Ms. Hollenbeck states that the existing bonds have an 
aggregate interest rate of 6.9 percent and were issued 
with a 25-year term, with a final payment date of June 1, 
2020. Ms. Hollenbeck states that if the proposed 
Refunding Bonds were issued at this time, such bonds 
would have an aggregate interest rate of approximately 
5.5 percent and would have a 21 -year term, with a final 
payment date of June 1, 2020. According to the proposed 
resolution, the maximum interest rate of any one 
maturity of the proposed Refunding Bonds is 12 percent. 

Ms. Hollenbeck estimates that this proposed refinancing 
of the 1994 Parking Meter Revenue Bonds would result in 
a total net present value savings in aggregate debt service 
of $663,000, over the 21-year term of the proposed 
Refunding Bonds. This estimate is based on an assumed 
Refunding Bonds par amount of $21,635,000 at an 
interest rate of 5.5 percent for a term of 21 years. 

Comments: 1. According to Ms. Hollenbeck, the proceeds from the 

sale of the subject Refunding Bonds will be placed in an 
Escrow Fund, which will be held by a third party trustee 
(the "Trustee") who has not yet been identified, until the 
bond call date of June 1, 2005 for the 1994 Parking Meter 
Revenue Bonds, at which time, the Trustee will redeem 
such bonds with the monies held in the Escrow Fund. 

Ms. Hollenbeck states that the Mayor's Office of Public 
Finance received bids from bond insurers to obtain a 
Surety Policy for the proposed Refunding Bonds. A 
Surety Policy is similar to an insurance policy and is 
purchased in order to avoid the necessity of funding a 
Debt Service Reserve Fund out of the Refunding Bond 
proceeds. According to Ms. Hollenbeck, the Mayor's Office 
of Public Finance plans to purchase a Surety Policy, 
through an Invitation to Bid process, from the low bidder 
at a cost of approximately 2.4 percent of the amount of the 
Debt Service Reserve Fund requirement 1 , or $51,000, 



1 Under the terms of the proposed refunding bond issuance, the Parking Authority is required to fund a Debt Service 
Reserve Fund in the amount equal to the lesser of 10 percent of the par amount of the proposed Refunding Bonds, 
100 percent maximum annual debt service or 125 percent average annual debt service on the proposed Refunding 
Bonds. In this case, the amount of the Debt Service Reserve Fund is an amount equal to 100 percent maximum 
annual debt service on the proposed Refunding Bonds or approximately S2.099.038. 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

A3 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



which would be funded from the subject Refunding Bond 
proceeds. 

2. Ms. Hollenbeck states that the exact amount of the 
bond issuance will not be known until the date of the 
competitive sale, as the interest rate will affect the 
aggregate principal amount needed to fund the Escrow 
Fund, the bond issuance costs, the bond insurance, and 
the Surety Policy. However, in no case will the bond 
issuance exceed $23,500,000. 

3. According to Ms. Hollenbeck, the subject Refunding 
Bonds must be sold in advance of defeasing 2 the 1994 
Parking Meter Revenue Bonds. Ms. Hollenbeck 
anticipates that the proceeds from the sale of the subject 
Refunding Bonds will be invested in State and Local 
Government securities which will mature on the dates 
that debt service on the 1994 Parking Meter Revenue 
Bonds is due and on June 1, 2005, the call date for such 
bonds. 

4. In accordance with the subject resolution, the cost of 
issuance of the subject Refunding Bonds cannot exceed 
$300,000 and such costs would be paid from bond 
proceeds. 

5. The proposed resolution also ratifies previous actions 
taken in connection with the subject Refunding Bonds, 
authorizes taking future actions in connection with the 
subject Refunding Bonds, and approves the form of a 
Continuing Disclosure Certificate and an Official 
Statement to be executed in connection with the subject 
Refunding Bonds. 

6. As previously noted, approval of the subject Refunding 
Bonds is estimated to result in aggregate debt service 
savings with a net present value of $663,000. 



Recommendation: Approve the proposed resolution. 



2 Defeasance is the term used to describe the termination of all rights and interests of the bondholders upon final 
payment of all debt service, in the manner required by the terms and conditions of the bond resolution. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

44 



Memo to Finance and Labor Committee 

March 31, 1999 Finance and Labor Committee Meeting 



//? *y 'S^- 



Harvey M. Rose 



cc: Supervisor Yee 

Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

45 



Attachment 



DESCRIPTION OF THE SERIES 1994 BONDS PROJECTS 

The following arc descriptions of each of the projects financed or to be financed from the 
proceeds of the Series 1994 Bonds. None of the projects or any revenues therefrom are pledged as 
security for the Series 1994 Bonds or Series 1999-1 Bonds. 

— -x- • i n .. « . Location: 2500 24th Street 

The Hospital Par/ang Project 

The proceeds of the Series 1994 Bonds were used to provide for the design, acquisition and 
construction costs, of an. approximate 800-space public parking structure to szrvc the Hospital located in 
San Francisco, California. The parking structure is located directly south of the Hospital on the block 
bounded by 23rd and 24th Streets, Utah Street and San Bruno Avenue. The Hospital Parking Project 
structure was completed in October 1997, and cost approximately S21,000,000. 

The Hospital Parking Project structure was designed so that an expansion from an approximate 
800-space to an approximate 1,150-space parking structure, could occur in the future. The Authority has 
no current plans to proceed with such an expansion. However, if such an expansion docs occur, it may 
be financed from various potential funding sources, including the issuance of Additional Bonds, subject 
to the satisfaction of certain conditions as provided in the Trust Agreement. See "SECURITY FOR THE 
BONDS - Additional Bonds". 

St. Mary's Square Garage Project Location: 433 Kearny Street 

The Authority undertook a seismic upgrading and renovation of St. Mary's Square Garage, a 
City-owned and Authority managed public parking structure located in the City. Approximately 
Sl,200,000 of the total project cost of 56,000,000 was financed from proceeds of the Series 1994 Bonds. 
The St. Mary's Square Garage seismic upgrade project is expected to be completed in December 1999. 

VallejoJChurchill Garage Project Location: 755 Vallejo Street 

A portion of the proceeds of the sale of the Series 1994 Bonds, approximately S250.000, was 
used to finance certain demolition costs of an existing building on property purchased by the Authority 
for the purpose of building a public parking structure. The demolition of the Vallejo/Churchill Garage 
was completed in early 1998. 

Settlement of Legal Claim 

Proceeds from the Scries 1994 Bonds, in the amount of approximately S235,000, were used to 
make a payment in settlement of a legal claim relating to the acquisition of certain property for the 
purpose of building a public parking structure in the City. 



46 



»54/S 



<H 




'iTTop 



city and County of San Francisco 

Meeting Minutes 

Finance and Labor Committee 

Members: Supervisors Leland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B 

Goodlett Place 

San Francisco, CA 

94102^1689 



Wednesday, April 07, 1999 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



Meeting Convened 

The meeting convened at 10:05 am 

REGULAR AGENDA 



DOCUMENTS DEPT. 

JUN \ 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



990299 [Taxes Due Dates] 

Supervisor Kaufman 

Ordinance amending Municipal Code, Part III. Article 12-B, by amending Section 1009 providing that taxes 
shall be due and payable on the first day of January each year, providing that taxes shall become delinquent if 
not paid on or before the last day of February of such year; requiring installment payments of taxes m excess 
of $2,500; and imposing a monthly penalty of 5 percent on delinquent taxes, up to 20 percent in the aggregate. 

(Amends SectionlOO*?.) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999. 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst: Supervisor Barbara Kauftnan; Richard 
Sullivan, Tax Collector: Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990300 (Taxes, Authority to Examine Records| 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance/Business Regulations), by 
amending Section 6.4-1, permitting the Tax Collector to inspect, examine and copy the records of taxpayers. 

(Amends Section 6.4-1.) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst, Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 6:00 PM on 4^'&V9 



Finan ~e and Labor Committee 



Meeting Minutes 



April 7, 1999 



990301 [Stadium Tax] 

Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance Business Regulations), by 
amending Section 6.4-2, providing that all amounts of stadium operator admission taxes are generally due and 
payable to the tax collector within five days after the taxable event, and requiring stadium operators to file 
returns within the time limits set forth in Section 304 of Article 1 1 of Part III of the San Francisco Municipal 
Code. 

(Amends Section 6.4-2.) 

2/17/99. ASSIGNED UNDER 30 DAY RULE io Finance and Labor Committee, expires on 3/19/1999 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



990302 [Taxes, Facilitation of Refunds) 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance Business Regulations), by 
amending Section 6.15-1, permitting the Tax Collector to waive the requirement that a taxpayer file a verified 
claim in writing stating the grounds upon which a claim for refund is founded where the Tax Collector 
determines that ( 1) an amount of tax, interest or penalty has been overpaid, or has been erroneously collected 
by San Francisco under Part III of the Municipal Code, and (2) all other conditions precedent to the payment 
of the refund have been satisfied. 

(Amends Section 6.15-1.) 

2/17/99, ASSIGNED UNDER 30 DAY RULE lo Finance and Lahor Committee, expires on 3/19/1999 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Barbara Kaufman, Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee. Bierman. Ammiano 



990303 [Taxes, Penalty for Failure to Pay Tax] 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part ill. Article 6 (Revenue and Finance/Business Regulations), by 
amending Section 6.17-1, imposing a monthly penalty of five percent (5%) of the amount of a delinquent tax 
(up to a maximum of twenty percent (20%)) and imposuig an additional penalty of twenty percent (20%) of 
the portion of any such tax that remains unpaid after the 90-day period commencing upon the date the 
taxpayer is notified of such delinquency. 

(Amends Section 6.17-1) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999. 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 6:00 P\l on 4/&V9 



Finance and Labor Committee 



Meeting Minutes 



April ',1999 



990304 |Taies, Negligence Penalties] 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance/Business Regulations), by 
amending Section 6.17-3, imposing a penalty equal to the annual fee for obtaining a registration certificate set 
forth in Section 1007(A) of Article 12-B of Part III of the San Francisco Municipal Code upon any person who 
fails*"to properly register, or fails to comply with a rule or regulation of the Tax Collector; imposing a penalty 
in the amount of $100 on persons who otherwise would not have owed a tax for each occurrence of a failure to 
file a return required under Part III of the Municipal Code on or before the date prescribed for filing; and 
imposing a penalty of $500 for each a failure to allow a full inspection of records pursuant to a request of the 
Tax Collector. 

(Amends Section 6. 1 7-3.) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supen'isor Barbara Kaufman; Richard 

Sullivan, Tax Collector, Supen'isor Ammiano Amended to delete the phrase "who otherwise would not have 

owed a tax" on page I , line 9; new title. 

AMENDED. 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance/Business Regulations), by 
amending Section 6 17-3, imposing a penalty equal to the annual fee for obtaining a registration certificate set 
forth in Section 1007(A) of Article 12-B of Part III of the San Francisco Municipal Code upon any person who 
fails to properly register, or fails to comply with a rule or regulation of the Tax Collector; imposing a penalty 
in the amount of $100 on persons for each occurence of a failure to file a return required under Part III of the 
Municipal Code on or before the date prescribed for filing; and imposing a penalty of $500 for each a failure 
to allow a full inspection of records pursuant to a request of the Tax Collector. 

(Amends Section 6.17-3.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



990305 [Taxes, Other Negligence Penalties] 
Superviso*- Kaufman 

Ordinance amending Municipal Code, Part III, Article 6 (Revenue and Finance/Business Regulations), by 
amending Section 6.17-2, imposing a monthly penalty of five percent (5%) of the amount of a underreported 
tax (up to a maximum of twenty percent (20%)0, where such underreporting is due to negligence or intentional 
disregard of the rules and regulations. 

(Amends Section 6.17-2.) 

2/1 7/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1 999 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 6:00 PM on 4/S/V9 



Finave and Labor Committee 



Meeting Minutes 



April 7, 1999 



990306 [Taxes, Definition of Builder/Developer] 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 12-B (Revenue and Finance Business Regulations), by 
amending Section 1002. 15(A)(3), providing that a person shall be deemed to be engaged in the business of 
developing and selling real property' if such person constructs an apartment house or commercial building. 

(Amends Section 1002.15(A)(3).) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999. 
Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990307 [Taxes, Registration Certificate Delinquency Date[ 
Supervisor Kaufman 

Ordinance amending Municipal Code, Part III, Article 12-B (Revenue and Finance/Business Regulations), by 
amending Section 1007(C), providing that the renewal fee for the annual registration certificate shall become 
delinquent if not paid on or before the end of October of each year. 

(Amends Section 1007(C).) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999. 
Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Supervisor Barbara Kaufman; Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Aves: 3 - Yee, Bierman, Ammiano 



990408 [Taxes, Application of Partial Payments| 
Supervisor Kaufman 

Ordinance amending San Francisco Municipal Code, Part III. by amending Section 6.9-7 providing that partial 
payments shali be applied first to interest, penalties and costs for that year, and the balance, if any, shall be 
applied to taxes due for that year. 

(Amends Section 6.9-7.) 

3/i/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/31/1999. 
Heard m Committee. Speakers: Harvey Rose, Budget Analyst; Supervisor Barbara Kaufman, Richard 
Sullivan, Tax Collector; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee. Bierman. Ammiano 



City and County of San Francisco 



Printed at 6:00 PM on /.&?« 



Finance and Labor Committee 



Meeting Minutes 



April ", 1999 



990527 [Lease and Sublease for Pier 1 (EmbarcaderoAVashington Street)| 

Resolution approving lease and sublease with AMB Property Corporation for the Development of Pier 1 
(Embarcadero and Washington Streets) as a maritime office project; approving negative declaration, and 
indemnity agreement. (Port) 

(Fiscal impact.) 

3/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 
Continued to April 14, 1999. 
CONTINUED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990565 [Budget Analyst Review, PUC Management Contracts] 
Supervisor Ammiano 

Motion directing the Board of Supervisors Budget Analyst to review the proposed Public Utilities 
Commission's capital improvement program management contract. 
3/22/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee Speakers Supen'isor Ammiano, Harvey Rose, Budget Analyst. In Support: Leslie 
Abbott, Policy Analyst, Local 21; David Novogrodsky, Executive Director, Local 21. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990509 [Property Sale, Alameda County Parcels 16, 16A (Bernal Property)) 
Supervisor Ammiano 

Resolution declaring Parcels 16 and 16A of the Bemal Property to be surplus; authorizing the General 

Manager of the Public Utilities Commission to execute a purchase and sale agreement to transfer Parcels 16 

and 16A to the Pleasanton Unified School District; and adopting findings pursuant to the California 

Environmental Quality Act. 

3/15/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 4/14/1999. 

Heard in Committee Speakers: Harvey Rose, Budget Analyst; Rick Nelson, Project Manager, Public Utilities 

Commission; Supervisor Ammiano; Supervisor Yee; Supervisor Bierman; Peter McDonald, Pleasanton 

School District. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 

Resolution declaring Parcels 16 and 16A of the Bemal Property to be surplus; authorizing the General 
Manager of the Public Utilities Commission to execute a purchase and sale agreement to transfer Parcels 16 
and 16A to the Pleasanton Unified School District; and adopting findings pursuant to the California 
Environmental Quality Act; requesting Public Utilities Commission to report back to the Finance and Labor 
Committee with revenue projections within three months. 
Continued to April 14, 1999 

CONTINUED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 6:01 PM on 4/tVV 



Finance and Labor Committee 



Meeting Minutes 



April 7, 1999 



981443 [Taxi Permit Fee Adjustments) 
Supervisor Newsom 

Ordinance amending Police Code Sections 2.26.1 and 2.27.1 to adjust permit and license fee schedules for 
motor vehicles for hire and to give a 50-percent discount for four years on permit fees for taxicabs and ramped 
taxicabs operating on compressed natural gas and amending Sections 1080, 1088 and 1 125 to include fees 
authorized by those sections in permit and license fee schedules for motor vehicles for hire. 

(Amends Sections 2.26.1, 2.27.1, 1080. 1088, and 1 125.) 
8/24/98, ASSIGNED UNDER 30 DAY RULE to Finance Committee, expires on 9/23/1998. 
1 /25/99, TRANSFERRED to Finance and Labor Committee 
3/10/99, CONTINUED TO CALL OF THE CHAIR. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Supen-isor Newsom; Captain John Ehrlich, 
Police Department; Supervisor Ammiano; Supervisor Yee; Supervisor Bierman. In Support Bill Zeller; Jack 
Trass. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING SAME TITLE. 
RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990504 (Proposed UCSF/Stanford Hospital Merger| 
Supervisor Ammiano 

Hearing to consider the effects of proposed merger of UCSF and Stanford Hospital and its impact on hospital 

staff, quality of medical services, and the community. 

3/15/99, RECEIVED AND ASSIGNED to Public Health and Environment Committee. 

3/18/99, TRANSFERRED to Finance and Labor Committee- President requests calendaring at Finance and Labor Committee meeting of 

April 7, 1999. 

Heard in Committee Speakers: Peter Van Etien, CEO, UCSF-Stan ford Health Services. Supervisor Bierman. 
Supervisor Ammiano; Anthony Wagner; Executive Administrator of Community Health Network; Corey 
Menotti ; Warren Goal; Mike Dragovich. RN. Department of Liver Transplants; Karen MacLeod, RN, 
President University Professional and Technical Employees; Susan Cietuat, RN, Pediatric ICU; Fred Alvarez, 
McKinnon Avenue Club; Spike Kahn, Paul Hessinger Coalition of University Employees; Rey Docena, Local 
715; Aura Huellgas. crisis secretary; Robert Valenzuela, Local 715; Harry Adams, Local 715; Mary Higgins; 
Thorild Urdall CA Nurses Association; David Padilla, Local 829; Donald Padilla; Bob Rouse; Jacqueline 
Gough; CA Nurses Association 
FILED. 



ADJOURNMENT 

The meeting adjourned at 12. 50 p m. 



City and County of San Francisco 



Printed at 6:01 PM on 4/&V9 



3 
/ 7 /ff 



CITY AND COUNTY 




Public Library,Gov't Info. Ctr., 5 th Fir. 
Attn: Susan Horn 



ofjan francisco D0C UMENTS DEPT. 
APR 7 1999 

.BOARD OF SUPERVISORS SAN FRANCISCO 

PUBLIC LIBRARY 

BUDGET ANALYST L.iDn«riY 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 

April 2, 1999 
TO: | Finance and Labor Committee 

FROM: Budget Analyst 

SUBJECT: /.pril 7, 1999 Finance and Labor Committee Meeting 



Items 1. 2, 3, 4, 5, 6. 7, 8. 9 and 10 - Files 99-0299, 99-0300. 99-0301. 99- 
0302. 99-0303. 99-0304. 99-0305. 99-0306. 99-0307. 99-0408 



Department: 
Items: 



Treasurer/Tax Collector 

99-0299: Ordinance amending Section 1009, Article 
12-B of Part III of the San Francisco Municipal 
Code (Revenue and Finance Business Regulations) 
providing that Business Payroll and Gross Receipts 
Taxes shall be due and payable to the City on the 
first day of January of each year; providing that 
taxes shall become delinquent if not paid on or 
before the last day of February of such year; 
requiring installment payments of taxes in excess 
of $2,500; and imposing a monthly penalty of five 
percent on delinquent prepayment of third-party 
operator taxes, up to 20 percent in the aggregate. 

99-0300: Ordinance amending Section 6.4-1, Article 
6 of Part III of the San Francisco Municipal Code 
(Revenue and Finance Business Regulations) 
permitting the Tax Collector to inspect, examine 
and copy the records of business taxpayers. 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



99-0301: Ordinance amending Section 6.7-2, Article 
6 of Part III of the San Francisco Municipal Code 
(Revenue and Finance Business Regulation-) 
providing that all amounts of Stadium Operator 
Admission Taxes be subject to the provisions of 
Section 804, Article 11, Part II of the Municipal 
Code and requiring those entities paying Stadium 
Operators Admission Taxes, such as the Giants and 
49ers, to file returns within the time limits set 
forth in Section 804 of Article 11 of Part III of the 
San Francisco Municipal Code. 

99-0302: Ordinance amending Section 6.15-1, 
Article 6 of Part III of the San Francisco Municipal 
Code (Revenue and Finance Business Regulations) 
permitting the Tax Collector to waive the 
requirement that a business taxpayer must file a 
verified written claim with the Tax Collector, 
stating the grounds upon which a claim for refund 
is founded, in those instances where the Tax 
Collector determines that (1) an amount of tax. 
interest or penalty has been overpaid, or has been 
erroneously collected by San Francisco under Part 
III of the Municipal Code, and (2) all other 
conditions precedent to the payment of the refund 
have been satisfied. 

99-0303: Ordinance amending Section 6.17-1, 
Article 6 of Part III of the San Francisco Municipal 
Code (Revenue and Finance Business Regulations) 
imposing a monthly penalty of five percent of the 
amount of a delinquent tax (up to a maximum of 20 
percent), and imposing an additional penalty of 20 
percent of the portion of any such tax that remains 
unpaid after the 90-day period commencing upon 
the date the business taxpayer is notified of such 
delinquency. 

99-0304: Ordinance amending Section 6.17-3, 
Article 6 of Part III of the San Francisco Municipal 
Code (Revenue and Finance Business Regulations) 
imposing a penalty equal to the annual fee for 
obtaining a Business Tax Registration Certificate 
set forth in Section 1007(A) of Article 12-B of Part 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

2 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



III of the San Francisco Municipal Code upon any 
person who fails to properly register, or fails to 
comply with a rule or regulation of the Tax 
Collector; imposing a penalty in the amount of $100 
on persons who otherwise would not have owed a 
tax for each occurrence of a failure to file a return 
required under Part III of the Municipal Code on or 
before the date prescribed for filing; and imposing a 
penalty of $500 for each failure of a business 
taxpayer to allow a full inspection of the business 
records pursuant to a request of the Tax Collector. 

99-0305: Ordinance amending Section 6.17-2, 
Article 6 of Part III of the San Francisco Municipal 
Code (Revenue and Finance Business Regulations) 
imposing a monthly penalty of five percent of the 
amount of an underreported business tax (up to a 
maximum of 20 percent) where such 
underreporting is due to negligence or intentional 
disregard of the rules and regulations. 

99-0306: Ordinance amending Section 

1002.15(A)(3), Article 12-B of Part III of the San 
Francisco Municipal Code (Revenue and Finance 
Business Regulations) providing that a person shall 
be deemed to be engaged in the business of 
developing and selling real property if such person 
constructs an apartment house or commercial 
building. 

99-0307: Ordinance amending Section 1007(C), 
Article 12-B of Part III of the San Francisco 
Municipal Code (Revenue and Finance Business 
Regulations) providing that the renewal fee for the 
annual Business Tax Registration Certificate shall 
become delinquent if not paid on or before the end 
of October of each year. 

99-0408: Ordinance amending Section 6.9-7, Article 
6 of Part III of the San Francisco Municipal Code 
(Revenue and Finance Business Regulations) 
providing that partial payments due to the City for 
delinquent Business Taxes shall be applied first to 
interest, penalties and costs for that year, and the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

3 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

balance, if any, shall be applied to the Business 
Taxes due for that year. 

Description: The ten proposed ordinances would amend various 

sections of the City's Municipal Code, referred to as 
the Revenue and Finance Business Regulations, to 
address the City's Business Taxes, which include 
Gross Receipts Taxes, Payroll Taxes, and the third- 
party taxes, such as Parking Taxes, Hotel Taxes, 
Utility User Taxes and Stadium Operator 
Admission Taxes. 

In December of 1997, the Board of Supervisors 
approved major changes to the City's Business Tax 
regulations to enhance the effectiveness of the Tax 
Collector's Office in collecting tax revenues that are 
due to the City. According to Mr. Patrick Sha of the 
Tax Collector's Office, some of the proposed subject 
ordinances will clean-up this previously adopted 
legislation in order to clarify language, without 
resulting in actual changes in practice. In addition, 
Mr. Sha reports that the proposed ordinances focus 
on the penalties that are assessed by the Tax 
Collector's Office in an attempt to make the 
penalties more reasonable and equitable and to 
encourage business taxpayers to more quickly pay 
their delinquent taxes. 

File 99-0299: The proposed ordinance would change 
the due date of the City's Business Payroll and 
Gross Receipts Taxes to the first day of January of 
each year, with such Taxes becoming delinquent if 
they are not paid on or before the last day of 
February of each year. Under the current 
provisions, the City's Business Payroll and Gross 
Receipts Taxes are due and payable by the last day 
of February of each year, with no specific provision 
regarding when such Business Taxes become 
delinquent. According to Mr. Sha, this language 
simply clarifies the existing practice, and will not 
result in any change for the Tax Collector s Office. 

The proposed ordinance would also change the 
threshold when a business must pay Payroll and 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



Gross Receipts Taxes to the City, to be consistent 
with previous amendments that have been 
approved. Under existing practices, businesses are 
only liable for making payments to the City if they 
owe a minimum of $2,500 in business taxes instead 
of a minimum of $1,000. Mr. Sha reports that this 
provision was not changed in the previous 
legislation. Therefore, this provision would comply 
with existing practice and would result in no fiscal 
impact to the City. 

In addition, all tax prepayments, which are paid by 
third-party operators (e.g. Parking Taxes, Hotel 
Taxes, Utility Taxes) for the previous month or 
quarter, are currently subject to a ten percent 
penalty of the amount of the delinquent tax 
amount, if not paid by the due date. Under the 
proposed ordinance, such Business Tax 
prepayments would be subject to a five percent 
penalty, instead of the current 10 percent penalty, 
as well as the amount of the delinquent tax 
payment, if the payment is delinquent not more 
than one month. Under the proposed ordinance, an 
additional five percent penalty would be added for 
each month or fraction of a month that the 
Business Tax payment is not made to the Tax 
Collector's Office, up to an aggregate total 
delinquency penalty of 20 percent. Mr. Sha reports 
that the proposed change in the penalty structure, 
to increase the amount of the penalty by five 
percent each month up to a total of 20 percent, 
versus the flat ten percent current penalty is 
intended to provide an incentive for delinquent 
Business Taxpayers to pay sooner. If this occurs, 
Mr. Sha reports that the additional revenue will 
assist the City's cash flow and increase interest 
earnings. However, Mr. Sha comments that overall, 
he does not anticipate any net additional penalty 
revenues from the proposed ordinance. 

File 99-0300: The proposed ordinance would allow 
the Tax Collector the right to inspect, examine and 
copy records of the taxpayer's business records, 
would subject the business taxpayer to penalties if 

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BUDGET ANALYST 

5 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



the business taxpayer refuses such records 
inspection, examination or copying, and may 
require the taxpayer to reimburse the Tax Collector 
for reasonable expenses incurred in the inspection, 
examination and copying of the books, papers and 
records of the taxpayer's business. Currently, the 
Tax Collector only has the right to inspect records 
of the taxpayer's business, subject the taxpayer to 
penalties if the taxpayer refuses such inspection 
and require taxpayer reimbursement for inspection 
costs only, but not reimbursement for the City's 
examination and copying costs. 

According to Mr. Sha, some business taxpayers 
have not been willing to cooperate with the Tax 
Collector's Office and the proposed new language in 
the ordinance should provide the Tax Collector 
with greater ability to thoroughly review, examine 
and copy necessary business taxpayer records, that 
are needed to audit or review City businesses. Mr. 
Sha reports that although the Tax Collector may 
receive some reimbursement for copying expenses, 
such reimbursement is not anticipated to be 
significant, and cannot be estimated at this time. 

File 99-0301: The proposed ordinance would 
require that all Stadium Operator Admission Taxes 
be due and payable to the Tax Collector within five 
days after the event, subject to the provisions of 
Section 804 of Article 11 of Part III of the 
Municipal Code, which details three different 
methods of collecting the Stadium Operator 
Admission Taxes. In addition, the proposed 
ordinance would require every third-party operator, 
except the stadium operator, to file a tax return for 
the preceding period by the last day of the month. 
The third-party stadium operators, such as the 
Giants and the 49ers, would be required to file a 
tax return with the Tax Collector's Office within 
the time frames established in Section 804, Article 
11 of Part III of the Municipal Code, which 
specifies when tax returns must be filed for 
stadium operators. 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

6 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



Although these Stadium Operator provisions 
primarily apply to the Giants and the 49ers, Mr. 
Jack Yee of the Tax Collector's Office reports that 
on occasion, another operator has conducted an 
event, such as a concert, at 3COM Park, and is 
subject to the Stadium Operator Admission Taxes. 
According to Mr. Yee, the proposed changes to the 
ordinance are intended to separate the Stadium 
Operator Admission Taxes from the other third- 
party operator taxes, such as hotel, parking and 
utility user taxes, and that such changes will not 
result in any actual changes in practice for the 
Stadium Operators or the Tax Collector's Office. As 
a result, Mr. Yee reports that there would be no 
fiscal impact from the proposed ordinance. 

File 99-0302: Currently, if a Business Tax, interest 
or penalty has been overpaid or erroneously 
collected by the Tax Collector's Office, the amount 
may be refunded to the taxpayer only if a verified 
claim is submitted by the taxpayer in writing, 
stating, under penalty of perjury, the specific 
grounds for which the claim was founded. The 
proposed ordinance would permit the Tax Collector, 
in his or her discretion, and upon good cause, to 
waive this requirement if the Tax Collector 
determines on the basis of other evidence presented 
that an amount of tax, interest or penalty has been 
overpaid and all other conditions precedent to the 
payment of a refund to the taxpayer have been 
satisfied. 

According to Mr. Richard Sullivan, the Tax 
Collector, the Tax Collector's Office receives 
numerous small claims from taxpayers for refunds 
due to overpayment, double payments, etc. Mr. 
Sullivan reports that the current system which 
requires the taxpayers' verification of such 
overpayments or refunds, in writing, is often 
cumbersome and unnecessary for both the taxpayer 
and the Tax Collector's Office. According to Mr. 
Sullivan, the Tax Collector's current computer 
system will generally identify such overpayments, 
or double payments during the reconciliation 

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BUDGET ANALYST 

7 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

process. Therefore, the proposed ordinance will 
permit the Tax Collector, to use his or her 
discretion, in evaluating other evidence for 
allowing a refund to a taxpayer. Mr. Sullivan does 
not anticipate that the proposed legislation will 
result in any fiscal impact, although Mr. Sullivan 
notes that the proposed amendment should 
improve customer relations. 

File 99-0303: The proposed ordinance would 
require any business taxpayer who is delinquent in 
paying any Business Taxes owed to the City to pay 
a five percent penalty on the delinquent tax owed, 
in addition to the amount of taxes owed, during the 
first delinquent month. Each month or fraction of a 
month thereafter, the delinquency penalty would 
increase by an additional five percent, up to a total 
aggregate delinquency penalty of 20 percent. Under 
the current provisions, any taxpayer who has not 
paid the taxes owed within ten days that the taxes 
are due is subject to a 20 percent penalty of the 
delinquent tax owed, in addition to the amount of 
taxes owed. Both the current and proposed 
provisions are in addition to interest that accrues 
on the delinquent tax amount, at the rate of one 
percent per month. 

Mr. Sha reports that in changing the penalty for 
delinquent taxes to a progressively increased 
amount, starting at five percent the first month, up 
to a total of 20 percent, it will encourage business 
taxpayers to pay their delinquent accounts on a 
more timely basis. Mr. Sullivan notes that the 
penalty increases to 40 percent of the delinquent 
tax owed for business taxpayers accounts after 90 
days of nonpayment of taxes after notification by 
the Tax Collector's Office, and that this provision 
will not change under the new ordinance. Mr. Sha 
cannot specifically estimate the fiscal impact of the 
proposed legislation, but anticipates that any 
i eduction in penalty revenue will be offset with 
increased interest earnings from those taxpayers 
who more quickly pay their delinquent tax bills. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

8 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



File 99-0304: The proposed ordinance would impose 
a penalty equal to the penalized taxpayer's annual 
Business Tax Registration Certificate fee for those 
business taxpayers who fail to register, fail to 
timely update their registration or provide 
misstatements on their registration form. The 
annual Business Tax Registration Certificate fee is 
currently $25 to $500, depending on the amount of 
taxes due to the City. The existing provisions 
impose a penalty of $20 a day, with a minimum of 
$100 and a maximum of $500 for such violations. 
Mr. Sha does not anticipate any significant change 
in penalty revenues collected by the Tax Collector's 
Office, as a result of the proposed ordinance. 

In addition, the proposed ordinance would impose a 
penalty of $100 for any business taxpayer's failure 
to file a Business Tax return by the due date. This 
$100 penalty is in addition to the proposed 
delinquent penalties that would be assessed under 
File 99-0303, discussed above. The Budget Analyst 
notes that the title of the proposed ordinance states 
that a penalty of $100 would be imposed on persons 
who otherwise would not have owed a tax, although 
the Tax Collector's Office indicates that the 
proposed $100 penalty would be imposed for any 
business taxpayer's failure to file the Business Tax 
return by the due date. Therefore, the Budget 
Analyst recommends that the title of the proposed 
ordinance be amended on Line 9 to delete the 
reference to "who otherwise would not have owed a 
tax". Currently, a taxpayer who fails to file a 
return, but who would have owed no tax, pays a 
penalty of $20 a day up to a maximum of $500. Mr. 
Sha estimates that this provision may result in 
minor increases in revenue, although he cannot 
estimate the amount of such increase. 

The proposed ordinance would also add a new 
provision to require that any person who fails to 
allow a full inspection of the records of his or her 
business within the time prescribed by the Tax 
Collector shall pay a penalty of $500 for each 
failure. Mr. Sha estimates that this provision will 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

9 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

result in some minor additional revenue for the Tax 
Collector's Office, but as of the writing of this 
report, he could not estimate the amount of such 
additional revenue. 

File 99-0305: The proposed ordinance would impose 
a penalty of five percent of the amount of the 
underreported tax, in addition to the tax owed, for 
the first month, if the Tax Collector determines 
that information on the Business Tax return was 
underreported due to negligence or intentional 
disregard of the City's rules and regulations. Mr. 
Sha reports that such underreporting would be 
determined through an audit or from an amended 
Business Tax return. For each additional month, 
an additional five percent penalty would be 
imposed, up to a total aggregate penalty of 20 
percent. The current ordinance provides a flat 20 
percent penalty to be imposed by the Tax Collector. 
It should also be noted that the current and 
proposed ordinance provides that when the Tax 
Collector determines that taxes are underreported 
due to fraud, the Tax Collector may impose a 50 
percent penalty of the amount owed on the 
taxpayer. 

Again, Mr. Sha reports that the proposed change is 
intended to encourage taxpayers to pay their 
delinquent taxes on a more timely basis, and as a 
result, Mr. Sha anticipates that the increased 
revenues from interest earnings will offset any 
shortfall in delinquent penalty collections, although 
no precise estimate is currently available. 

File 99-0306 : The proposed ordinance would add 
the provision that a person would be deemed to be 
engaged in the business of developing and selling 
real property if such persons sell any real property 
which said person constructed, or caused to be 
constructed: provided such sale occurs either prior 
to or within three years after the date upon which 
(i) a Certificate of Occupancy or its equivalent is 
issued or (ii) tenants who occupy such property pay 
rent to the property owner after completion of the 

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BUDGET ANALYST 

10 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

construction. The current provisions require that 
the sale of the property is either prior to or within 
three years after the date upon which 25 percent or 
more of the square footage of the building is first 
occupied by tenants after the construction. 

Mr. Sha reports that the proposed ordinance would 
have no fiscal impact on the City and that the 
intent of the proposed change is to clarify the 
definition of those persons engaged in the business 
of developing and selling real property. 

File 99-0307: The proposed ordinance would add 
the provision that the renewal of the annual 
Business Tax Registration Certificate would 
become delinquent if not paid on or before the last 
day of October of each year. The current ordinance 
does not contain language regarding the 
delinquency date for the Registration Certificate 
renewals. 

According to Mr. Sha, the proposed ordinance 
would clarify the delinquency date for Registration 
Certificate renewals and would not change existing 
practice. As a result, the proposed ordinance would 
have no fiscal impact on the City. 

File 99-0408: The proposed ordinance would 
establish the order for payment of partial payments 
due to the City for Business Taxes to be applied 
first to interest, then to penalties and then to costs. 
Currently, the ordinance requires partial payments 
first to penalties and then to interest, and then to 
costs. 

Mr. Sha reports that the proposed change would 
bring the Tax Collector's Office in compliance with 
the State's Revenue and Taxation Code and will 
not have any fiscal impact on the City. 

Comments: 1. Overall, Mr. Sha reports that the fiscal impact of 

the proposed ordinances will be negligible. 
Although there is likely to be some reduction in 
actual penalty revenues collected, Mr. Sha notes 

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BUDGET ANALYST 

11 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

that the progressive increase in the amount of the 
penalties is meant to encourage taxpayers to pay 
their delinquent tax bills in a more timely manner. 
If this occurs, Mr. Sha reports that any shortfall in 
delinquent revenue collection would be offset by 
increased interest earnings by collecting such 
delinquent payments sooner. However, Mr. Sha 
was not able to provide any documentation of this, 
at this time. 

2. Mr. Sullivan reports that the Tax Collector, in 
accordance with Section 600 of the City's 
Administrative Code, under the Common 
Administrative Provisions, has the authority to 
waive all of the existing and proposed penalties, 
including interest, for good cause. Mr. Sha reports 
that waivers of penalties are often granted for 
unintentional missed payments or other oversights 
that were not deliberate on the part of the business 
taxpayer. Mr. Sullivan however, notes that the 
waiver of interest payments generally requires 
more stringent review. 

3. The attached memorandum from Mr. Sullivan 
summarizes the estimated fiscal impacts of the 
proposed legislation. Mr. Sullivan states that the 
proposed amendments will not result in net 
reduced revenues to the City. In addition, Mr. 
Sullivan writes that the proposed changes in the 
penalties to taxpayers will be more equitable and 
at the same time relieve the Tax Collector's 
administrative burden in regulating the current 
penalties. 

Recommendations: 1. Amend the title of the proposed ordinance (File 

99-0304) on Line 9 to delete the reference for 
applying penalties to business taxpayers "who 
otherwise would not have owed a tax", in order that 
penalties would be imposed for all business 
taxpayers' failure to file Business Tax returns by 
the due date. Our recommendation is consistent 
with the Tax Collector's intent for the proposed 
legislation to be imposed on all business taxpayers 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



who fail to file a Business Tax return by the due 
date. 

2. Approve the proposed ordinances, as amended. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

13 



R3-31-99 1 1 : 85 TAX C0L.LECTUK ftUHlNlsiH«iiu" » f— • * «« ' ■ ■ * 

Office Of The Treasurer & Tax Collector 

City and County of San Francisco 

Mailing Address: P.O. Box 7426 ♦ San Francsca, CA 94120-7426 

Street Address; City Hall, Room 140 «• 1 Dr. Carlton 3. Goodlett Place ♦ San Frandsco. CA S4102 



7&n 



r u 




SUSAN LEAL, Treasurer 

Phone: (415) 554-W78 

RICHARD A. SULLIVAN, Tax Collector 
Phone:(4[5)554-M70 



March 31, 1999 



Harvey Rose 

Budget Analyst's Office 

1390 Market Street, Room 1025 

San Francisco, CA 94102 

Dear Mr. Rose: 

Re: Proposed Amendments to Tax Ordinances 

File Nos. 990300 thru 990307, 990335, 990336, 990408 

The proposed amendments to various sections of Part III of the San Francisco Municipal 
Code were submitted to the Board of Supervisors for approval on February 17, 1S99, 
February 22, 1999, and March 1, 1999. In our opinion, these proposed amendments 
will not result in any negative fiscal impact. In summary, potential impact of penalties on 
taxpayers will be more equitable and at the same time relieve our administrative burden 
to regulate such. 

If you have any questions, please contact me. 

Sincerely, 

Richard A. Sullivan 
Tax Collector 

cs Susan Leal 



14 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Item 11 - File 99-0527 



Department: 
Item: 



Description: 



Port 

Resolution approving a lease and sublease with 
AMB Property Corporation for the development of 
Pier 1 as a maritime office project and approving a 
negative declaration and indemnity agreement. 

The proposed resolution would (1) approve a 50- 
year lease for Pier 1 with the Port as the lessor and 
AMB as the lessee and (2) approve a sublease for a 
portion of Pier 1 with the AMB as the sublessor and 
the Port as the sublessee. Pier 1 is located 
immediately north of the Ferry Building, on The 
Embarcadero near the intersection with 
Washington Street. Pier 1 is currently owned and 
operated by the Port, which operates a parking lot 
for 221 vehicles on a month-to-month basis. 
According to Mr. Kirk Bennett of the Port, the Port 
currently receives approximately $354,237 of 
annual revenues from Pier 1 parking operations, 
which comprises one level of approximately 118,313 
square feet of space. 

Under the proposed subject lease with AMB, the 
Port would continue to own Pier 1, but would enter 
into a long-term, 50-year lease with AMB wherein 
AMB would construct and manage a proposed new 
office building. AMB would be responsible for the 
construction costs, for occupying a portion of the 
space, subleasing a portion of the office space to the 
Port and for obtaining tenants for the remaining 
space. Under the proposed subject sublease 
between AMB and the Port, the Port, as the 
sublessee, would pay AMB annual rent of 
$1,836,608 for 52,475 square feet of office space at 
a monthly rate of $2.92 per square feet during the 
first five years of the sublease. This sublease 
includes escalation clauses in the remaining 45 
years of the sublease, in addition to amortized 
tenant improvements at an additional annual 
expense to the Port of $67,000 for the first 15 years, 
for total expenses to the Port of $1,903,608 for each 

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BUDGET ANALYST 

15 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

of the first five years. In return, AMB, as lessee 
under the subject lease , would pay the Port, as 
lessor, a minimum of $1,782,859 annually, 
although this amount may be reduced depending 
on various factors contained in the lease, as 
discussed in Comment 8, with opportunities for 
sharing additional rental income in the future 
years. At the end of the 50-year lease and sublease, 
the building and all improvements would belong to 
the Port. 

The proposed lease for the new office building at 
Pier 1, is anticipated to begin in August of 1999 
and would contain a total of 190,904 square feet of 
space, including approximately 127,692 square feet 
on the first level and an additional 63.212 square 
feet on a second or mezzanine level. This would 
include 149,687 square feet of office space (78 
percent), 39,341 square feet of public access space 
(21 percent) and 1,876 square feet for the existing 
Pier 1 Deli (one percent ). 

When the construction of the new office building is 
completed, which is anticipated to be in December 
of 2000, the Port would relocate all of its 
administrative offices from the Ferry Building, a 
City-owned building occupied by the Port at no 
rental cost, to the new Pier 1 office building where, 
as previously noted, the Port would pay rent. In the 
Ferry Building, the Port currently occupies 41,934 
useable square feet, as well as approximately 6,000 
square feet of storage space. As shown in 
Attachment 1, under the proposed lease, the Port 
would occupy 45,630 useable square feet, although 
the rent would be based on a total of 52,475 square 
feet of space, which includes the restrooms, service 
areas, walkways and other common areas. Mr. 
Bennett reports that the Port is proposing, under 
the subject lease and sublease, to increase its 
current office space due to three factors: (1) 
although most of the Port's storage space of 6,000 
square feet will be moved to a less expensive 
location, some of the proposed new office space at 
Pier 1 will be used for storage; (2) more public 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

16 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

space, including public meeting rooms and lobby 
area, will be added; and (3) to allow for some 
potential expansion of Port staff over tbe next ten 
years. Mr. Bennett notes that the proposed office 
space in Pier 1 would enable the Port to increase its 
staff by approximately seven positions over the 
next ten years, at which time further increases in 
office space, would be permitted under the 
sublease. 

Of the remaining 97,212 square feet of office space 
(149,687 total square feet of office space less 52,475 
square feet for the Port), 39,422 square feet would 
be occupied by AMB for their administrative offices 
and approximately 57,790 square feet would be 
leased by AMB to outside tenants for office space, 
with priority given to maritime tenants. However, 
it should be noted that the subject lease does not 
restrict AMB to only maritime tenants for 
occupancy of the new building. 

The proposed sublease between AMB and the Port, 
which would begin when the construction is 
completed, in approximately two years, would 
extend for the life of the 50-year lease, or through 
July of 2049. Under the proposed sublease, with 
the Port as the sublessee, the Port would pay AMB 
an initial base rent of $153,051 per month, or 
approximately $2.92 per square foot per month for 
the 52,475 square feet of office space, for a total of 
$1,836,608 per year, which is a rate of $35 per 
square foot per j r ear, for the first five years. This 
base rent would increase by 18.5 percent on the 
fifth anniversary, and adjust to the fair market 
value, as determined by appraisers retained by 
AMB and the Port on each tenth anniversary of the 
50-year sublease. Under the proposed sublease, 
AMB would provide the utilities and the Port would 
provide maintenance sendees for the subject office 
space. 

On each ten year anniversary, the Port would have 
the option to occupy up to an additional 
approximately 12,000 square feet, for a total 

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BUDGET ANALYST 

17 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



maximum expansion of 30,000 square feet, at the 
then current fair market value, as determined by 
appraisers retained by AMB and the Port. Mr. 
Bennett reports that although the Port has no 
current plans to expand into this space, the 
proposed sublease would contain this expansion 
potential provision because, Mr. Bennett notes that 
the Port cannot predict what the Port's office space 
needs may be over the next 50 years, which is the 
life of the proposed sublease. According to Mr. 
Bennett, this expansion provision would allow the 
Port the flexibility to decide whether it needs such 
additional space in the future and there is no 
obligation to use such space. The Budget Analyst 
notes that although the Board of Supervisors is 
required to approve the Port's budget, the 
expansion of additional office space for the Port and 
the related funds for that specific purpose is not 
subject to the Board of Supervisors approval. The 
Budget Analyst further notes that the additional 
space of 30,000 square feet would provide the Port 
with approximately 66 percent more space than the 
45,630 square feet proposed under the subject 
lease. 

As shown in Attachment 1, the estimated total 
construction costs for the proposed Pier 1 project is 
$34,511,526. In addition, as shown in Attachment 
1, excluding the amortized costs of tenant 
improvements, the Port would pay AMB annual 
rent of $1,836,608 at a rate of $35 per square foot 
per year during the first five years of the sublease, 
increasing to $2,176,380 in year six of the sublease, 
with subsequent Port rent increases in future 
years. As shown in Attachment 1, AMB would 
occupy its 39,422 square feet of space on an 
allocated annual cost of $1,576,880, at a rate of $40 
per square foot per year and other office subtenants 
would occupy 57,791 square feet of space at a 
projected rate of $36.50 per square foot per year, for 
revenues of $2,109,370 from these other subtenants 
to AMB in the Pier 1 facility. The Pier One Deli 
would also occupy 1.876 square feet of space in Pier 
1 at a rate of $30 per square foot per year and 

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BUDGET ANALYST 

18 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



would pay AMB $56,270 annually for rent. Like the 
Port's sublease, all these subleases will provide an 
18.5 percent rental increase on the fifth 
anniversary and adjustments to the fair market 
rent on each tenth anniversary. The estimated total 
annual rental income from the proposed new 
building to AMB, including the rent costs allocated 
to AMB itself of $1,576,880, would be $5,579,127 
during each of the first five } r ears, of the lease, 
increasing to approximately $6,611,265 beginning 
in year six of the proposed sublease. 

Under the proposed lease with AMB, AMB would 
receive a return of 11 percent on their estimated 
construction costs of $34,511,526, or $3,796,268 
annually, for the 50-year life of the lease. Under 
the proposed lease, and as shown in Attachment 1, 
the Port would receive the balance, or $1,782,859 
($5,579,127 annual rent less $3,796,268 return to 
AMB) as the minimum rent, during the first five 
yesiTS of the proposed lease. In addition, 
amortization of additional tenant improvements of 
an additional $10.50 per square foot, above the 
standard tenant improvement allowance, are 
estimated to cost the Port an additional $67,000 
per year for 15 years. As a result, during the first 
five years, the Port would pay AMB a net rent of 
$120,749 per year (rental costs of $1,836,608 plus 
$67,000 for tenant improvements less payment of 
$1,782,859 from AMB to the Port). According to Mr. 
Bennett, the "standard tenant improvement 
allowance" equals $32.50 per square foot, which is 
the level of allowance currently being offered by 
office landlords in the marketplace. To complete 
normal tenant improvements, it is expected that all 
of the subtenants will need to contribute to the 
costs of their tenant improvements above this 
allowance. 

Beginning in year six, and continuing for the 
remaining 45 years of the lease, AMB would pay 
the Port 50 percent of the total rental income 
received by AMB, from all of the tenants, including 
the Port and AMB. Mr. Bennett reports that this 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

19 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

revenue sharing formula in the future years will 
result in a positive net cash flow for the Port. 
Attachment 1 indicates a positive net income to the 
Port of $55,548 beginning in Year 6 of the sublease. 

The proposed resolution would also authorize a 
Port indemnity, as part of the sublease between the 
Port and AMB Property Corporation. This 
indemnity provides that the Port within the 
premises of the sublease would indemnify, defend 
and hold harmless AMB from and against any and 
all Port claims, costs and expenses, except for 
claims arising from active negligence or willful 
misconduct by AMB Property Corporation or its 
agents. The proposed lease also contains similar 
language for AMB to indemnify the Port for all of 
the leased premises. 

Comments: 1. Currently, the Port owns, occupies, leases and 

maintains the Ferry Building for office space for 
commercial tenants and the Port's own 
administrative offices. Under this arrangement, the 
Port pays no rent for its administrative offices 
located in the Ferry Building and currently receives 
approximately $1.4 million of annual rent, 
according to Mr. Alec Bash of the Port. However, 
since the Port would move from its existing office 
space in the Ferry Building, to the proposed new 
office building to be constructed under the proposed 
lease and sublease, the Port would have to pay rent 
to AMB to sublease space in the proposed new 
office building at Pier 1. 

Although not the subject of this proposed 
resolution, according to Mr. Bash, the Port issued a 
separate Request for Proposals (RFPs) in 1998 to 
develop the Ferry Building. The Port received four 
responses to this RFP and is currently in exclusive 
negotiations with Wilson Cornerstone to enter into 
a 65-year lease for the Fern - Building, which would 
include seismic upgrading and complete 
renovations of the facility. The renovations would 
include public retail, such as restaurants and fresh 
and prepared food markets on the first floor and 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

20 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



office space on the top two floors. Mr. Bash 
estimates that construction on the Ferry Building 
is projected to begin in January of 2001 and to be 
completed by June of 2002. The Port would 
continue to own the Ferry Building and similar to 
the proposed Pier 1 50-year lease, at the conclusion 
of the 65-year lease for the Ferry Building, the 
Ferry Building and all improvements would revert 
back to the Port. 

Mr. Bash reports that under ongoing negotiations, 
which to date are not completed, the Port is 
expected to continue to receive $1.4 million per 
year of rental income from the Ferry Building, to be 
adjusted by the Consumer Price Index (CPI) every 
five years. In addition, Mr. Bash reports that the 
Port would share 50/50 in future Ferry Building 
earnings received by Wilson Cornerstone, after 
Wilson Cornerstone receives an 11 percent return 
on their equity. According to Mr. Bash, it is 
anticipated that, per Wilson Cornerstone's 
projections beginning in year 2005, the Port would 
receive an additional $800,000 under this revenue 
sharing arrangement, and that over the first 20 
years of the lease, the Port would receive an 
additional $23 million in revenues in addition to 
the adjusted annual $1.4 million rental income 
from the Ferry Building. 

Mr. Bash reports that in order to renovate the 
Ferry Building, the Port will need to vacate their 
office premises. Furthermore, Mr. Bash notes that 
when the renovations at the Ferry Building are 
completed, it is anticipated that Ferry Building 
office space will rent for approximately $50 per 
square foot per year, which is approximately $15 
more per square foot, than the proposed rent of $35 
per square foot that the Port will pay for office 
space in Pier 1. 

2. According to Mr. Bennett, on March 9, 1999, the 
Port Commission approved a Development 
Agreement with AMB Property Corporation. This 
Development Agreement establishes the conditions 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

21 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

for (1) the development of Pier 1 by AMB and (2) 
the delivery of the lease and the sublease between 
the Port and AMB for Pier 1. The proposed lease 
and sublease, which are the subject of the proposed 
resolution, are included as Attachments to the 
Development Agreement. This Development 
Agreement will expire when the construction is 
completed and the lease and sublease become 
effective. Mr. Bennett reports that although the 
Port Commission has approved this Development 
Agreement, the Port will not sign this Agreement 
until the proposed lease and sublease are approved 
by the Board of Supervisors. Mr. Bennett notes that 
if the Board of Supervisors amends either the 
proposed lease or sublease, the Port would have to 
renegotiate the Development Agreement with 
AMB. 

3. Section 9.118(c) of the Charter requires the 
Board of Supervisors approval of leases for uses of 
real property, extending for ten or more years. This 
Charter Section provides an exemption for leases of 
property under the jurisdiction of the Port 
Commission for maritime use. According to Mr. 
Bennett, although the lease and sublease are for 
predominantly maritime uses, the Port has 
requested and recommended Board of Supervisors 
approval because the Board will be required to 
approve appropriations each year for the Port 
sublease and if the Board fails to do so, AMB may 
offset lost revenues against the lease payments. 

4. The Port issued a Request for Interest and 
Qualification on January 21, 1998 for development 
of Pier 1. According to Mr. Bennett, the Port 
received four responses to this Request from major 
national developers. One of the responders, La 
Salle-ORIX Joint Venture was deemed non- 
responsive because LaSalle did not include a 
required earnest money deposit. Attachment 2 
provided by the Port identifies each of the 
remaining three firms which submitted proposals 
and provides a summary of each proposal, 
including AMB's proposal. As shown in Attachment 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

22 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



2, AMB Property Corporation had the highest (a) 
Projected Hard Construction Costs ($18,600,000) 
and (b) Projected Total Development Costs 
($23,640,000), although Mr. Bennett reports that 
after an analysis of the costs was conducted by the 
Port, the estimated hard construction costs and 
total construction costs were found to be even 
higher than those proposed by any of the 
responders. As shown on Attachment 1, the current 
total estimated construction costs are $34,511,526 
for the proposed office building at Pier 1, including 
$28,598,225 in hard costs. On May 26, 1998, the 
Port Commission selected AMB Property 
Corporation to enter into an Exclusive Right to 
Negotiate with the Port for this development 
project for Pier 1, based on the staffs 
recommendation, as shown in Attachment 3, which 
contains the reasons for selecting AMB. 

5. On January 5, 1999, Pier 1 was placed on the 
National Register of Historic Places. Mr. Bennett 
reports that having Pier 1 placed on the National 
Register of Historic Places provides (1) an 
expedited California Environmental Quality Act 
(CEQA) review of the proposed project, (2) an 
exemption from the Bay Conservation Development 
Commission's (BCDC) jurisdiction which could 
otherwise limit permitted uses on the pier, and (3) 
potential Preservation Tax Credits for the project. 
The Preservation Tax Credits would enable AMB to 
receive certification from the National Park Service 
that the construction, when completed, complies 
with the Secretary of Interior's Standards for 
Rehabilitation, making the proposed project eligible 
for a 20 percent Federal Historic Preservation Tax 
Credit. The Port will receive 50 percent of the 
benefits of these tax credits in the form of a credit 
against the construction costs applied to the 
formula used to calculate the minimum rent. As 
shown in Attachment 1, the Port would receive a 
credit of $3,031,608 for their portion of the credits. 

6. The State Lands Commission has determined 
that the proposed project is in compliance with 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

23 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



State Trust purposes, by preserving a maritime 
facility, providing office space for the Port, allowing 
public access and accommodating historic 
preservation of the Ferry Building. 

7. Under the proposed lease, the Port on an 
emergency basis would reserve the right to berth 
vessels adjacent to Pier 1 without AMB's approval 
and on a non-emergency basis, with AMB's prior 
written consent, which could not be reasonably 
withheld, at no cost to the Port. According to Mr. 
Bennett, the Port's proposed lease with AMB 
excludes the berthing areas adjacent to the piers. 
Any berthing revenues from Pier 1 would accrue to 
the Port. 

8. Although Mr. Bennett reports that Attachment 1 
represents the Port's current projection of the costs 
and revenues, there are two conditions which could 
increase the costs for the Port, which are not 
reflected on this Attachment. The first factor is 
whether the contractor uses up to a 15 percent 
contingency on the construction and design costs, 
which is valued at $4,289,734 (15 percent x 
$28,598,225), and which would reduce the 
minimum rent paid by AMB to the Port, depending 
on how much of the contingency is required. The 
second factor is whether the Port will receive the 
Historic Tax Credits valued at $3,031,608, which 
would further reduce the minimum rent to be paid 
by AMB to the Port by approximately $333,477 
annually. If the entire 15 percent contingency is 
required by AMB, and the Port does not receive the 
tax credit, then the minimum projected annual rent 
payable by AMB to the Port of $1,782,859 would be 
reduced by $802,226 to $980,633 per year during 
the first five years. 

Mr. Bennett provided documentation to show 
alternative financial scenarios for either or both of 
the above factors. This documentation shows that 
instead of a net rental payment due from the Port 
to AMB of $120,749 in the first five years of the 
lease and sublease, the Port could be liable for up 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

24 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



to $922,974 per year in rental payments due to 
AMB for each of the first five years. As shown in 
Attachment 1, the Port is anticipated to receive 
$55,548 in net revenues in year 6. However, the 
alternative scenarios indicate that the Port would 
have to pay AMB net rentals of $746,677 in year 6, 
with decreasing net rental amounts up until year 
21 of the proposed lease. After year 21, in all of the 
scenarios, the Port would receive a positive net 
revenue stream. Ms. Stephanie Downs of the Port 
reports that the source of rental payments during 
the initial years of the proposed lease and sublease 
would be the Port's Operating Revenues, which she 
currently projects will have a surplus of $2,027,709 
in FY 2000-2001, when the sublease is anticipated 
to begin. Ms. Downs notes that the Port's FY 1998- 
99 budget includes $939,000 in operating surplus 
funds. 

Over the 50-year term of the proposed lease and 
sublease, the Port is anticipated to receive between 
$23.4 million and $63.5 million of net additional 
revenues, or an average of approximately $468,000 
to $1,270,000 per year of additional income, 
depending on which scenario occurs. Mr. Bennett 
notes that AMB is guaranteeing the rent of at least 
$36.50 per square foot for the 57,790 square feet of 
space to be leased by the other office subtenants. 
According to Mr. Bennett, AMB is therefore 
assuming the entire leasing risk and the entire risk 
for construction and design costs above the 15 
percent contingency. 

9. The Budget Analyst notes that none of the above 
analysis conducted by the Port factored in the 
current annual revenue of $354,237 that the Port 
receives from the Pier 1 parking operations, that 
would be lost if the subject lease and sublease are 
approved. Over the 50-year term of the proposed 
lease and sublease, the current annual revenue of 
$354,237 is projected to generate a total of 
approximately $40 million, based on an annual 
inflation rate of three percent. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

25 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Therefore, subtracting the existing Pier 1 annual 
revenues from parking operations from the Port's 
calculations of projected future net additional 
revenues of between $23.4 million and $63.5 
million over the 50-year lease term results instead 
in an overall loss to the Port of approximately $16.6 
million on the low side to a positive revenue stream 
of $23.5 million on the high side. 

Subsequent to this finding by the Budget Analyst 
and disclosure of these facts to the Port, Mr. 
Bennett advised the Budget Analyst that Pier 1 is 
not seismically safe, is currently deteriorating and 
is not likely to be continued for 50 years as a 
parking facility. However, Mr. Bennett could not 
provide an estimate of how long such parking 
operations could be maintained by the Port. 

10. Mr. Bennett notes that the proposed 
development of Pier 1 would initially generate over 
$100,000 of new Possessory Interest Tax revenues 
for the City. Possessory Interest Taxes are a means 
for the City to collect Property Taxes on public 
property that is used for private purposes. Mr. 
Bennett reports that Possessory Interest Taxes are 
currently paid by Port tenants to the City's General 
Fund that occupy Port property. However, under 
the proposed sublease, wherein the Port is the 
sublessee, the Port anticipates that it would be 
exempted from Possessory Interest Taxes, although 
the other tenants in the proposed Pier 1 
development would be subject to such Possessory 
Interest Taxes. 

11. The current zoning ordinance requires that a 
specified amount of parking be included in such 
developments. On February 16, 1999 the Planning 
Department granted a parking exemption to the 
proposed development project to enable the 
proposed Pier 1 project to be constructed with no 
parking facilities. Instead, Mr. Bennett reports that 
the Port is encouraging a Transit First policy. 
However, at the same time, the Budget Analyst 
notes that the City's General Fund would lose 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

26 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



Parking Tax revenues of approximately $68,000 
that are currently generated by the Pier 1 parking 
facility. 

12. Mr. Neil Sekhri of the City Attorney's Office 
reports that both the City and the Port are 
adequately protected under the indemnity 
provisions included in the proposed lease and 
sublease. 

13. The proposed sublease states that if the Board 
of Supervisors does not appropriate adequate funds 
for the Port's rent, AMB may offset its lost Port 
sublease revenues by reducing the amount paid to 
the Port in lease payments, subject to AMB's 
obligation to mitigate any damages by subletting 
this space. 

14. On January 21, 1999, the Planning Department 
issued the Final Negative Declaration for the 
proposed development of Pier 1. This included 
mitigation measures regarding air quality, noise 
and cultural resources due to the proposed 
construction of Pier 1. In addition, in February of 
1999 the Planning Department found that the 
proposed project is consistent with the Eight 
Priority Policies of City Planning Code Section 
101.1. 

15. The Budget Analyst raises the following 
concerns about the proposed lease and sublease: (1) 
the Port would vacate currently rent-free premises 
in the Ferry Building in order to occupy space in 
the proposed Pier 1 development at an initial net 
cost of $120,749 to $922,974 per year, for at least 
the first five years; (2) the Port would increase its 
useable office space from 41,934 square feet in the 
Ferry Building to 45,630 square feet in the Pier 1 
facility, an increase of 3,696 square feet, or 8.8 
percent; (3) the proposed sublease allows for 
expansion of up to an additional 30,000 square feet, 
or an additional 66 percent increase in space, 
without Board of Supervisors' approval; (4) the 
proposed sublease would require that the Port pay 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

27 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



for additional tenant improvements above the 
standard allowance of $32.50 per square foot, 
excluding architecture, engineering and general 
conditions at an additional cost of $67,000 per year 
over a 15-year period; (5) although the City's 
General Fund is projected to receive over $100,000 
of Possessory Interest Taxes, the City would forfeit 
approximately $68,000 of Parking Tax revenues 
from the existing facility, (6) the proposed sublease 
states that if the Board of Supervisors does not 
appropriate adequate funds for the Port's rent, 
AMB may offset its lost Port sublease revenues by 
reducing the amount paid to the Port in lease 
payments, subject to AMB's obligation to mitigate 
its losses by subletting the space and (7) the Port 
would forfeit the current Pier 1 annual revenues of 
$354,237, or a projected total of approximately $40 
million over the 50 year term of the lease and 
sublease. 

As a result, the Budget Analyst notes that the Port 
could have a negative net cash flow of an estimated 
$16.6 million on the low side to a positive net cash 
flow of $23.5 million on the high side over the 
proposed 50-year term of the lease and sublease, 
instead of the Port's reported positive net cash flow 
of between $23.4 million to $63.5 million over the 
50-year term of the lease and sublease. 

16. In summary, the proposed resolution would 
approve a 50-year lease and sublease with AMB 
Property Corporation for the construction and 
development of a new office building at Pier 1. 
Under the proposed sublease, the Port would pay 
AMB $153,051 per month or $1,836,608 per year, 
for the first five years. Including the enhanced 
tenant improvements for the Port, the Port's 
annual rental payments would increase by $67,000 
for the first 15 years, or a total of $1,903,608 for the 
first five years. The Port's base rent would then 
increase by 18.5 percent to $2,176,380 in year six. 
or a total of $2,243,380 annually with the 
amortized tenant improvements, with subsequent 
future rental increases over the 50-year term. As 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

28 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



noted above, the Port currently occupies the Ferry 
Building, rent-free. However, the Port is currently 
in exclusive negotiations with Wilson Cornerstone 
for a 65-year lease for seismic upgrading and 
complete renovations to the Ferry Building, which 
would require all tenants, including the Port, to 
vacate the premises during such renovations. The 
Ferry Building negotiations, which to date are not 
completed, are expected to continue to generate 
$1.4 million per year of rental income to the Port, 
adjusted by the CPI, plus a 50/50 revenue sharing 
in future years. 

Under the proposed lease between the Port and 
AMB, AMB would receive an annual return of 11 
percent on their construction costs of $34,511,526, 
or $3,796,268 per year for the 50-year life of the 
lease. During the first five years, the Port would 
receive the balance from the annual rents received 
by AMB, less the required 11 percent return to 
AMB. This balance would vary from between 
$980,633 to $1,782,859, during the first five years, 
depending on whether AMB requires a 15 percent 
contingency on the construction and design costs 
and whether the Port receives the Historic Tax 
Credits for this Pier 1 project. Overall, the Port 
could be liable to make rental payments to AMB of 
up to $922,974 for each of the first five years. 

Beginning in year 6 of the proposed lease and 
sublease, the Port would begin to share on a 50/50 
basis the increased rents above the initial projected 
minimum that AMB receives from the subtenants. 
Depending on construction cost contingencies and 
tax credit factors, this shared rental arrangement 
could result in a positive net cash flow for the Port 
beginning anj^where between year 6 and 21 of the 
50-year lease. Overall, the total rental cost to the 
Port would be $222.4 million, or an average cost of 
$4.45 million annually over the 50-year period. At 
the same time, the total revenues to the Port would 
be between $245.9 million and $285.9 million over 
the 50-year period, such that the Port estimated 
that it would receive between $23.4 million on the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

29 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

low side to $63.5 million on the high side, more 
than the Port spends over the same 50-year period. 

However, the Budget Analyst found that the Port 
had failed to take into consideration the fact that 
the Port currently receives annual revenues from 
parking operations of $354,237 from Pier 1. 
Subtracting these current annual revenues of 
$354,237 over the 50-year term of the lease and 
sublease results in a projected total loss of 
approximately $40 million of parking revenues to 
the Port. When considering this loss of revenues 
from the Port's parking operations, this results in a 
negative cash flow to the Port of an estimated $16.6 
million on the low side to a positive net cash flow of 
$23.5 million on the high side over the 50-year 
term of the proposed lease and sublease, instead of 
the Port's previously reported positive revenue 
calculations of $23.4 million on the low side to 
$63.5 million on the high side. 

Recommendation: Approval of the proposed resolution is a policy 

matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

30 



Attachment 1 



ATTACHMENT 3 

LEASE FOR PIER 1 

BUDGET 



CONSTRUCTION 5UDG; 



"a=3 COSTS 



Pier Substructure 

Core & Shell Construction 

enant Improvements 
General Conditions 

Bonds. Insurance, & City Taxes 
Contractor's Ovemead 4 Profit 

Construction & Design Contingency ■ 
Cost escalation for 1 Year 



55,411,000 

12.753,000 
5^326,000 
1,370.000 



25,520,000 
S2&.000 
961.000 



Hard Costs Subtotal 



Nona 

2.5% 



2S.40S.OOO 


710.225 



ss: Reimbursement of over standard tenant improvements Standard @ 532.50 excluding A&E and general conditions 

Tota' Hart! Costs 
5QCT COSTS 



5.1 19 .225 
(521.000) 



Design & Construction Management Fees 

Testing. Permits & Other Owner Costs 

City Exactions 

FF&E for Common Areas 

Leasing Commissions 

Interest During Construction *" 

Le-;al & Accounting Fees ** 

Non-Refundable Deposit 

Construction Period Ground Rent 

Construction Costs Subtotal 

Lesst Port's share of Historic Tax Credits 

TOTAL CONSTRUCTION COSTS 



Other Maritime Space @ S10.00 



22.598.225 

4.153,000 
352,000 

1,137.000 
250,000 
577,910 

1,959,000 
400,000 
100.000 



rota' Soft costs 



2.944.910 



95% x 20% x 85% x 50% ' 



37,543.135 

(3,03 1,608) 

"534.511.S2S 



TENANT RENTAL INCOME fTrinlo Net) TO AM3' 


Usable Sq. Ft 


Rentab 

©15', 


a Sq. Ft. 
.Load 


Rent Per Sq. Ft. 


Rent 
Yearl 


Rent 
Year 6**** 




Port space 

Other office subtenants space 

Space occupied by Tenant (AMB) 


45.630 
50.253 

34.280 




52.475 
57.791 
29.422 




S25.00 
535.50 
540.00 


51.E3E.608 
2.109,370 
1.575.880 


52,175,380 
2,499.603 
1.868.603 


Subtotal: Offica Space 
Pier One Dec 


130.163 
1.531 




149.587 
1.876 


S30.00 


5,522.257 
55.270 


6,544,586 
65.679 


PROJECTED TOTAL RENTAL INCOME 
TOTAL RENTAL INCOME 
JEXCESS RENTAL INCOME 


131.794 




151.553 


*■ 


-.55.579,1 27 i 
55,579,127 


55,511.265 

51.022.138 



LEASE RENTAL ANALYSIS- 



Rent 
Yearl 



Rant 
Year 6 — 



otal Construction Costs 

PROJECTED TOTAL RENTAL INCOME 
Less: Required Return to Tenant (AM3) 

MINIMUM RENT DUE PORT 
PARTICIPATION RENT DUE PORT 
RENT DUE PORT 

Less: Port Base Rent (Due under Port Sublease) 

Less: Amortisation of Port Tenant Improvements over 

Standard pursuant to Port Sublease 
NET Rent Due Port/fDue AM3) 



Total Construction Costs @ 11 % 

Constant throughout Lease term 

50% of Excess Rental Income 

Shows Minimum and Participation RenL but 

not Additional Rent 

S1C.50 (estimated) psf 180-month amortization @ 9', 



534,511,525 

5.579,127 
| P.7S5.2S3) 

^^.722.253^^.1^82.259 
r.;?H5^-3^gSy^gs"l 5,069 
jfilSn :7 E2.E53 -^--rZZSe -S3_£~ 



(1.835.603) 
(67.000) 



F^£(5-.20.749) ^^■-555.542 j 



Maximum Construcion & Design Contingency equals fifteen percent (15%) of Hart Costs SuPtotaL 
*" Excludes all points, fees, interest and other expenses regarding permanent /take-out financing 
~ Assumes that 2C% Historic Tax Credits sold at e5% discount to third party and that 95% of costs eligible. 
••" Year 5 represents an example lor purposes of demonstrating Participation Rent calculation. 

g:\kirk\Pier1Budget 



Attachment 2 



z O Z ™ t) 

O"o Z CD o 

- 5 Z O * 

£ S ■ ? ™ £ 



E f 



I 



(5 5 

g I 



2. = 

3 1 



3 o 
IB 



s r 



ij 






? • S 8 3 | 
:|88 o o 

„ -g o o - o 



?3 S 






o5„ 
u. a E 



K°* 



- ». ■» o •: 



» tt = J = n 

5- i o ° • _ 



m — *J *-< "D 



E'tn 



5 3 

I O 



HI 



i *? i 



?? 



3 • 



i 

5 

2 = 



£ ° o 



3 t 



2 3 



32 



Attachment 3 



B£CO!VCVffiNDATION 



f™»fc owonn^of cxSLSS^o^^ 1 ^ "^ ** Proper* 
1. Tte follow^ taOT 3 Mgh]igilt ^ b2jis - for ^ sa(rs £^™**»«»« of Pie, 

AMB-s proposal for public access resoonds better to the Ware™™ n . 
gu.oelines and to the Port's public access objective « faaST ^ puWic ac " ss 
Pfoposal to provide access around the pier 5TSi£Sf " J" **' '"= ,0 ** 
P'« which connect to Herb Caen Way ? * ° n "* south s «= of the 

AMB's proposal better responds to the Port's obie-lives for Inn. , 

- t ri bed ha the KH &Q , due to AMB's V^S^^J^S^Si 

AMB'sf ^ ov ^theterm of the lease. 

s^rt/r^ *= s ~ - d ^^ssnsr reatai ^ 

■ enaeno, ^ te „, md quality rf ^ ^ fap J = °™- space and tenant 

Lil 1S a ^ advantage to 



Pn 



^?ared by: Paul Osmundson, Director. Planning & Develop 

VAGSNDAStechiswe ngm «o n= g 0l «tt.A m b.doc\K3\j s «\3/2Q*s 



33 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Item 12 - File 99-0565 

1. The proposed motion would direct the Budget Analyst to conduct a review of 
and prepare a report on the proposed Public Utilities Commission (PUC) Capital 
Improvement Program Management Contract. 

2. The purpose of the review, according to the proposed motion, is to determine 
if contracting out by the PUC of its management functions related to the PUC 
Capital Improvement Program will result in either (a) savings or increased costs; (b) 
increased or decreased oversight of expenditures; and, (c) provide any other benefits 
or costs when compared to managing the PUC's Capital Improvement Program on 
an inhouse basis with existing and/or new Civil Service City employees. 

3. According to Ms. Carolyn Olsen, Deputy General Manager of the PUC, the 
PUC is currently preparing a Request for Proposals (RFP) for contracting out of 
engineering management functions for the first phase of the PUC's Capital 
Improvement Program. The tentative schedule for the selection process is to submit 
the RFP and Contract Management plan to the Civil Service Commission for 
approval in late April or early May. The RFP would then be submitted to the Public 
Utilities Commission for approval prior to issuance of the RFP to interested 
consultants. The consultant selection process is expected to be completed in the fall 
of 1999. 

4. The proposed motion further directs the Budget Analyst to give priority to 
reviewing the PUC's Capital Improvement Program Management Contract upon 
completion of the audit of the Department of Parking and Traffic. Assigning this 
priority to the proposed review of the PUC Capital Improvement Program 
Management Contract would mean that other pending performance audits would be 
deferred. Currently, the Budget Analyst's performance audit program, as previously 
approved by the Board of Supervisors, directs the following studies and performance 
audits: 

• Department of Parking and Traffic (a draft report has been completed and 
is now under review with the Department); 

• San Francisco Zoo (performance audit is underwa3 r ); 

• Study of Privatization of City Golf Courses (Assigned as a priority project. 
Work will begin on completion of DPT Performance Audit); 

• Assessor/Recorder; 

• San Francisco Redevelopment Agenc}'. 



Board of Supervisors 

Budget Analyst 

34 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

5. The Budget Analyst estimates that the proposed review of the PUC Capital 
Improvement Program Management Contract would require approximately 200 
staff hours. The estimated cost for such a review, at our current hourly rate of 
$83.85, would therefore be $16,077. Since the proposed project would be conducted 
under our existing contract with the Board of Supervisors, there would be no 
additional costs to the City. 



Board of Supervisors 
Budget Analyst 

35 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Item 13 - File 99-0509 



Department: 



Item: 



Description: 






Public Utilities Commission (PUC) 
Water Department 

Resolution declaring Parcels 16 and 16A of the 
Bernal Property to be surplus; authorizing the 
General Manager of the Public Utilities 
Commission to execute a purchase and sale 
agreement to transfer Parcels 16 and 16A to the 
Pleasanton Unified School District; and adopting 
findings pursuant to the California Environmental 
Quality Act (CEQA). 

The Bernal Property is approximately 510 acres of 
unimproved land, owned by the City's Water 
Department under the jurisdiction of the PUC. The 
property is located primarily in an unincorporated 
area of Alameda County, immediately adjacent to 
the City of Pleasanton. 

The proposed resolution would declare that Parcels 
16 and 16A, which consist of approximately 11.2 
acres of land, or 2.2 percent of the total of 510 acres 
of the Bernal Property, are surplus to the needs of 
the Water Department. Parcels 16 and 16A are 
located at the intersection of Case Avenue and 
Junipero Street, within the Bernal Property 
adjacent to the City of Pleasanton. 

The proposed resolution would also adopt findings 
pursuant to CEQA and would authorize the 
General Manager of the PUC to sell this surplus 
property to the Pleasanton Unified School District 
for the construction of a public elementary school. 

Under the proposed purchase and sale agreement 
between the PUC and the Pleasanton Unified 
School District, the purchase price for the proposed 
11.2 acre parcel would be $6.4 million, or 
approximately $571,429 per acre. However, 
according to the purchase and sale agreement, the 
Pleasanton Unified School District would pay the 
City only $3.0 million of the purchase price in cash, 
at the time of the closing on the property. The 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

36 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

balance, or $3.4 million of the total purchase price 
of $6.4 million, would be allocated as a credit 
toward school developer fees which would 
otherwise have to be paid by the PUC as the owner 
of the Bernal Property when the development 
commences. School developer fees are one of the 
various developer fees (e.g., affordable housing fees, 
park development fees, etc.) that are required to be 
paid by the owner and/or developer of the property 
to the City of Pleasanton, prior to the issuance of a 
building permit. 

According to Mr. Rick Nelson, the PUC's Project 
Manager for the Bernal Property, the Bernal 
Property will be subject to a total of approximately 
$18.2 million of school developer fees to be paid by 
the owner and/or developer of the Bernal Property, 
based on the estimated square footage of the 
residential units proposed to be developed on the 
Bernal Property. The proposed $3.4 million school 
developer fee credit would reduce the estimated 
$18.2 million of school developer fees to $14.8 
million that the owner and/or developer of the 
Bernal Property Development Project would be 
subject to paying. Under specified conditions, these 
$3.4 million of school developer fees credits the City 
would receive under the proposed purchase and 
sale agreement, can be sold by the City and 
effectively transferred to the next owner of the 
property, if the City ultimately sells the Bernal 
Property. 

In addition, the proposed purchase and sale 
agreement states that the purchase price can be 
further adjusted if all of the following three 
conditions are met: (1) on or before July 1, 1999, 
the Pleasanton City Council votes to approve the 
Bernal Property project on the remaining 498.8 
acres (510 acres less the subject parcels totalling 
11.2 acres); (2) the Pleasanton City Council's 
approval of the Bernal Property Development 
Project becomes final and effective and is not 
subject to further legal challenge by January 1, 
2000; and (3) any referendum or initiative vote by 
the Pleasanton electorate on the Bernal Property 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

37 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



Development Project occurs at tbe November, 1999 
election and is positive regarding the approval of 
the proposed Bernal Property Development Project. 
Although Mr. Nelson could not provide the Budget 
Analyst with any assurances that these three 
conditions would be met, if these conditions are not 
met, then the City would still receive $3 million in 
cash as well as the school developer fee credits of 
$3.4 million. 

Mr. Nelson reports that it is "extremely likely" that 
the Bernal Property Development Project will be 
subject to a referendum or initiative vote by the 
Pleasanton electorate. In fact, Mr. Nelson 
forwarded to the Budget Analyst's Office a copy of 
the text of the Pleasanton Initiative being 
circulated by the Pleasanton Citizens Alliance for 
Public Planning. Mr. Nelson acknowledges that 
there are no guarantees that this citizens' group 
will be successful in either obtaining the necessary 
number of signatures for the ballot or attaining a 
positive vote on the issue. 

However, Mr. Nelson notes that the last two 
development projects approved by the Pleasanton 
City Council were subject to a referendum vote by 
the electorate, and both of these development 
projects were significantly smaller (i.e., one project 
included 300 units and one project included 90 
units) than the proposed Bernal Property 
development project. However, the decision by the 
electorate on any future project is uncertain. 

If all of these three conditions are met, then (1) the 
City would still receive the $3.0 million cash when 
the subject property for the 11.2 acres closes 
escrow; (2) the above-noted school developer fee 
credit of $3.4 milhon from the Pleasanton School 
District to the City of San Francisco would be 
eliminated, such that the City of San Francisco 
would not receive any school developer fee credits; 
and (3) the City of San Francisco would pay $2.0 
milhon to a Pleasanton Unified School District 
designated endowment, trust, foundation or other 
non-profit educational organization, by April 29, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

38 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

2000. Under this scenario, the PUC would only 
receive a total of $1.0 million ($3.0 million at the 
close of escrow less $2.0 million paid to a 
designated educational non-profit organization by 
April 29, 2000) out of the purchase price of $6.4 
milli on, or $5.4 million less than the purchase price 
for the sale of this property to the Pleasanton 
School District. 

Mr. Nelson reports that the proposed $5.4 million 
downward adjustment (loss of $3.4 million in school 
developer fee credits plus $2 million to be paid by 
the City of San Francisco to a non-profit 
educational organization) from the $6.4 million 
purchase price of the 11.2 acre parcel is being 
proposed to build community support in Pleasanton 
for this project. According to Mr. Nelson, this is not 
untypical of the concessions many development 
projects make in order to gain political and public 
favor. Mr. Nelson notes that because school 
overcrowding has become such a public concern in 
Pleasanton, the proposed purchase price reduction 
is being offered as an incentive for the Pleasanton 
City Council to take an approval action on the 
remaining 498.8 acres of the Bernal Property 
Development Project by July 1, 1999 and to build 
community support for the project in the event the 
project approvals are put to public vote. 

Comments: 1. Mr. Nelson advises that the PUC has been 

working with Alameda County since 1994 and the 
City of Pleasanton since approximately 1986 or 
over 13 years to obtain development rights (known 
as land use entitlements) to build a mixed-use 
development on the 510 acres of the Bernal 
Property. Mr. Nelson reports that the planned 
mixed-use Bernal Property Development Project 
currently being negotiated with the Pleasanton 
City Council, which has still not approved the 
Project, would consist of up to 1.900 residential 
housing units, 750,000 square feet of commercial 
office space, an 18-hole public golf course, 40 acres 
of parks and an elementary school which would be 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

39 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 






annexed into the City of Pleasanton, if all the 
contemplated development approvals are obtained. 

According to Mr. Nelson, to date, the PUC has 
secured a development agreement and zoning 
reclassification for the development of the Bernal 
Property from Alameda Count}". However, Mr. 
Nelson reports that the Bernal Property 
Development Project, under the County's 
jurisdiction, still requires many additional 
approvals and permits (e.g., wastewater treatment 
and disposal facilities, water supply system, etc.) 
before the Bernal Property' could be developed. Mr. 
Nelson cautions that the PUC's ability to obtain 
these subsequent permits and approvals is 
uncertain and it will take considerable time and 
money to secure these approvals. In addition, Mr. 
Nelson notes that the City of Pleasanton will likely 
pursue legal action over Alameda County's 
approvals of the Bernal Property Development 
Project, which would delay and could possibly 
overturn these County approvals. 

2. However, Mr. Nelson reports, as previously 
noted, that San Francisco still has not yet reached 
final agreement with the City of Pleasanton for the 
Bernal Property Development Project. As noted 
above, the PUC contacts with the City of 
Pleasanton began in approximately 1986, or over 
13 years ago. 

According to Mr. Nelson, to date, San Francisco has 
applied to the City of Pleasanton for land use 
entitlements for the Bernal Property 7 , which 
includes a pre-annexation development agreement, 
specific plan, environmental impact report and 
other land use certifications, agreements and 
approvals for the development of the Bernal 
Property. Mr. Nelson advises that these 
applications by San Francisco for both Alameda 
County and the City of Pleasanton provide for an 
elementary school site on Parcels 16 and 16A. 
However, Mr. Nelson notes that San Francisco did 
not anticipate the sale of the subject Parcels 16 and 
16A prior to the overall development of the rest of 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

40 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



the 498.8 acres of the Bernal Property 
Development Project. 

3. According to Mr. Nelson, the immediate need for 
the Pleasanton public elementary school is in 
response to the State's recent policy of encouraging 
only 20 students per class, which has resulted in 
elementary school overcrowding in Pleasanton. The 
proposed elementary school on Parcels 16 and 16A 
is scheduled to open in September of 2000, or in 
approximately 18 months. Mr. Nelson advises that 
if the City does not sell the proposed parcels to the 
School District, the Pleasanton School District has 
threatened to condemn Parcels 16 and 16A, and to 
use eminent domain powers to take the subject 
property. The Budget Analyst notes that although 
the State may be encouraging only 20 students per 
class in elementary school classes through financial 
incentives to local school districts, the State has not 
imposed any requirements for such reduced class 
size on local school districts nor does the State 
require the construction of this new school. 

4. The Pleasanton Unified School District issued a 
negative declaration for the acquisition and 
construction of the proposed Bernal Property 
Elementary School under the requirements of the 
California Environmental Quality Act (CEQA). On 
March 2, 1999, the PUC passed a resolution 
adopting these CEQA findings and the proposed 
resolution would also adopt similar findings 
pursuant to CEQA. 

5. In August of 1998, the San Francisco Board of 
Supervisors approved a resolution (File 98-1254) 
authorizing the PUC to prepare and solicit 
imitations to bid and/or hold a public auction for 
the sale of the Bernal Property. At the time, the 
PUC indicated that the City could proceed to either 
sell the property outright or partner with a private 
developer and share in the risk and profits. As a 
result, Mr. Nelson reports that the PUC issued a 
request for quotations (RFQ) in November of 1998 
to seek interested parties to bid on the purchase of 
the Bernal Property. According to Mr. Nelson, in 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

41 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



January of 1999, the PUC qualified 12 bidders 
based on their financial status, development 
experience and other factors. Mr. Nelson advises 
that if and when the City of Pleasanton gives their 
final approval for the proposed project, the PUC 
intends to proceed with the selection of a 
purchaser/developer for the remaining 498.8 acres 
of the Bernal Property. 

6. According to Mr. Nelson, the PUC intends to sell 
the remaining 498.8 acres of property outright, 
rather than having the City involved in the 
development of the Bernal Property. Therefore, San 
Francisco would receive a lump sum payment for 
the sale of the property rather than receiving a 
future long-term revenue stream. Mr. Nelson could 
not provide the Budget Analyst with an estimate as 
to the fair market value which such a sale would 
generate. 

In a June, 1994 management audit report of the 
Water Department, the Budget Analyst reported 
with regard to the subject property that the real 
estate development project was "...estimated to 
have a long term net revenue benefit to the City of 
$319 million." However, Mr. Nelson cautions that 
this estimate was based upon a financial 
subconsultant's report which rested on a number of 
assumptions, such as assuming a more conceptual 
project that is considerably different than the 
project currently under consideration and assuming 
that the City would be the sole developer of the 
property. According to Mr. Nelson, since these 
assumptions are no longer applicable, the estimates 
may not have any relevance to today's market. 
However, Mr. Nelson could not provide the Budget 
Analyst with the estimated current value of the 
long-term net revenue benefit to the City, if the 
City were directly involved in the development of 
the project, instead of just selling the property 
outright. 

According to Mr. Nelson, the reason for forgoing a 
future long-term revenue stream and selling the 
property outright is because it was determined by 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

42 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

the PUC that (1) the City would have to incur 
additional risk to develop this property, (2) the 
City's track record thus far on this project has not 
been smooth or easy and (3) the City would not be 
able to move quickly enough, given the numerous 
approvals from the PUC, Board of Supervisors and 
Mayor, that would be required at each step, to 
undertake such a significant development project, 
as the Bernal Property Development Project. The 
final decision on whether to sell or develop the 
property will be subject to the Board of Supervisors 
approval. 

7. As discussed above, the Bernal Property is 
currently located in the unincorporated area of 
Alameda County and the City has received the 
necessary development approvals from Alameda 
Count}'. But, Mr. Nelson notes that the developer 
would need to provide all necessary fire service, 
water, sewer and other infrastructure 
improvements to the site, if the project remains in 
the unincorporated part of Alameda County. 
However, since the property is adjacent to the City 
of Pleasanton, Mr. Nelson notes that the property's 
infrastructure could be integrated with the City of 
Pleasanton's systems, if the project is approved by 
the City of Pleasanton, and the Bernal Property 
subsequently annexed by the City of Pleasanton, 
with much less risk to the developer. 

According to Mr. Nelson, although the PUC still 
intends to sell the remaining 498.8 acres of 
property outright, the PUC is proceeding with 
efforts to secure these final development approvals 
from the City of Pleasanton for the proposed 
development project, rather than selling the 
property without such approvals, due to the 
increased potential sale value of the property to the 
developer if such approvals were obtained prior to 
the property being sold by the City. However, as 
previously noted, Mr. Nelson advises that a current 
appraisal of the potential sale value of the entire 
Bernal Property is not available at this time. 
Furthermore, Mr. Nelson cannot estimate what the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

43 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 






current value to the property would be with such 
approvals. 

8. A valuation of the subject 11.2 acre parcel by 
Keyser Marston Associates, Inc. for the PUC, 
indicates the fair market value of the property is 
$6,580,000. As indicated above, the proposed 
purchase price of the property would be $6.4 
million, or $180,000 less than the appraised fair 
market value. 

As previously noted, only $3.0 million of the $6.4 
million purchase price would be received in cash, 
with the $3.4 million balance in school developer 
fee credits. Because the school developer fee credits 
would need to be discounted to induce developers to 
purchase such credits, the Keyser Marston 
Associates, Inc. valuation report indicates that the 
actual cash value of the $3.4 million of school 
developer credits is approximately 80 percent, or 
$2.7 million. Therefore, the total cash value of the 
$6.4 purchase price would actually be $5.7 million 
($3 million cash plus $2.7 million value of school 
developer fee credits), which is $880,000 less than 
the estimated $6,580,000 fair market value of the 
property. 

9. Although the valuation indicated that the fair 
market value of this property is $6,580,000, Mr. 
Nelson indicates that the proposed purchase price 
of $6.4 million, or at a discounted rate of $5.7 
million is reasonable for the PUC to sell the subject 
11.2 acre parcel to the Pleasanton School District 
because (1) it is still a good value for this property, 
(2) if the Pleasanton School District pursues an 
eminent domain action to take this 11.2 acre 
parcel, it is unclear how much the City would 
ultimately receive for the property, and (3) if the 
Pleasanton School District pursues an eminent 
domain action to take this 11.2 acre parcel, the 
other provisions included in the proposed purchase 
agreement would be voided. 

Some of the major provisions included in the 
proposed purchase agreement (1) protect the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

44 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



rem ainin g 498.8 acres of the Bernal Property from 
a possible forced annexation by the City of 
Pleasanton by requiring that the Pleasanton School 
District to vote its property valuation in the 
elementary school site as directed by the City of 
San Francisco, (2) ensure the cooperation by the 
Pleasanton Unified School District on subsequent 
City of Pleasanton and Alameda County approvals 
and (3) require the Pleasanton School District to 
serve students generated by the Bernal Property 
development, regardless of whether the City of 
Pleasanton approvals are received. However, the 
Budget Analyst notes that ensuring the cooperation 
of the Pleasanton Unified School District cannot be 
certain as individuals can change and the same 
individuals can change their position. However, Mr. 
Nelson reports that these provisions are contained 
in the proposed purchase and sale agreement to be 
entered into between the PUC and the Pleasanton 
Unified School District and if the Pleasanton 
Unified School District does not live up to these 
contractual obligations, the PUC could sue the 
District for breach of contract. 

10. As discussed above, the purchase price of $6.4 
million would be adjusted downward to a total of $1 
million (loss of $3.4 million in school developer fee 
credits plus $2 million to be paid by the City of San 
Francisco to a non-profit educational organization) 
if three specific conditions are met by the 
Pleasanton City Council and the Pleasanton 
electorate regarding approval of the Bernal 
Property Development Project. However, Mr. 
Nelson notes that the payment to the non-profit 
educational organization is to be paid 120 days 
after the final and effective project approvals are 
obtained for the remaining 49S.8 acre project from 
the City of Pleasanton. Mr. Nelson reports that 
once such final and effective project approvals are 
obtained, the PUC intends to seek approval from 
the PUC and the Board of Supervisors for sale of 
the Bernal Property. Therefore, according to Mr. 
Nelson, it is "unlikely" that San Francisco itself 
will be required to make the $2 million additional 
payment to the non-profit, but rather this 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

45 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



responsibility will be assumed by tbe new owner of 
the Bernal Property. Yet at tbe same time, that Mr. 
Nelson states it is "unlikely" San Francisco will 
have to pay the $2 million, this subject agreement 
requires the City to pay the $2 million to the non- 
profit organization. Furthermore, Mr. Nelson 
cannot guarantee that the new owner of the project 
will make such payments. 

11. When queried by the Budget Analyst, Mr. 
Nelson responds that there is no assurance or 
guarantee, if the proposed resolution is approved, 
and the 11.2 acre parcel is sold to the Pleasanton 
School District, that the City of Pleasanton will 
grant the final approvals for the Bernal Property 
development project. However, Mr. Nelson notes 
that the City of Pleasanton began a series of public 
hearings on the Bernal Property development 
project on March 30, 1999, that are expected to 
result in a Pleasanton City Council vote on the 
project in June of 1999, in accordance with a 
Pleasanton City staff report. 

12. Mr. Andy Moran of the PUC reports that the 
funds received by the PUC from the sale of the 
proposed 11.2 acre parcel would accrue to the 
Water Department's Enterprise Fund. According to 
Mr. Carlos Jacobo of the PUC, if and when the 
subject 11.2 acre parcel is sold to the Pleasanton 
School District and the Water Department receives 
such revenues, the PUC will request the necessary 
appropriation approvals from the Board of 
Supervisors to expend such additional revenues. In 
addition, Mr. Moran reports that the monies 
received from the eventual sale from the remaining 
498.8 acres of the Bernal Property would also be 
deposited in the Water Department's Enterprise 
Fund. According to Mr. Steven Carmichael of the 
PUC, these funds may be used for the construction 
of a City office building at 525 Golden Gate for the 
PUC and other City departments, which is 
currently estimated to cost approximately $75 
million. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

46 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

13. Tbe Budget Analyst notes that in accordance 
with Charter Section 16.103, receipts from the 
Water Department must be maintained in a 
separate enterprise fund for the Water 
Department. This Charter Section also identifies 
how, and in what specified order, appropriations 
from these Water Department funds must be made. 
In addition, this Charter Section states that if at 
the end of any fiscal year, or as part of the 
budgeting process, the Controller certifies or 
estimates that excess surplus funds of the Water 
Department exist, then such excess surplus funds 
may be transferred by the Board of Supervisors to 
the City's General Fund. 

14. As shown in the Attachment provided by the 
PUC, from approximately June of 1988 through 
March of 1999, the PUC has spent $6,823,058 on 
this Bernal Property development project. In 
addition, as shown in the Attachment, the PUC 
estimates that they will incur approximately an 
additional $200,000 to complete this project, for a 
total estimated City cost of $7,023,058. Of this 
total, approximately $4,040,058 was spent for the 
primary consultant, The Planning Collaborative, to 
assist on this project. Mr. Jacobo reports that 
Water Department revenues were used to pay for 
these expenses. As previously noted, to date, the 
City has obtained initial development approvals 
from Alameda County for the Bernal Property 
development project but, approval by the City of 
Pleasanton has still not been reached. 

15. The Budget Analyst requested Mr. Nelson to 
provide a memorandum explaining the reasons, in 
writing, why this proposed resolution should be 
appro% r ed. While Mr. Nelson was cooperative with 
the Budget Analyst and provided detailed 
documentation, Mr. Nelson declined to provide the 
Budget Analyst with a memorandum explaining 
the reasons for approving this resolution. 

Recommendation: In total, the Public Utilities Commission has 

expended over $6.8 million on the Bernal Property 
Development Project and to date, with the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

47 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



exception of obtaining residential and commercial 
rezoning of tbe project from Alameda County, has 
secured no guarantees that such expenditures will 
result in future economic benefits for the City. The 
Budget Analyst cannot recommend approval of the 
proposed resolution for the following reasons: 

• A valuation of the subject 11.2 acre parcel 
indicates a fair market value of $6,580,000. 
However, the PUC proposes to grant concessions 
to the Pleasanton School District by selling the 
property for $6.4 million, including $3.0 million 
in cash and $3.4 million in school developer fee 
credits. However, the PUC's consultant notes 
that the discounted value of the $3.4 million in 
school developer fee credits, if sold by the PUC, 
would be $2.7 million. Therefore, the sale of the 
property for, in effect, $5.7 million ($3.0 million 
in cash and a market value of $2.7 million in 
school developer fee credits) is $880,000 less 
than the fair market value of $6,580,000. 

• Further, the purchase price of $6.4 million 
would be adjusted downward to a total of $1 
million (loss of $3.4 million in school developer 
fee credits plus $2 million to be paid by the City 
of San Francisco to a non-profit educational 
organization to be designated by the Pleasanton 
Unified School District) if three specific 
conditions are met by the Pleasanton City 
Council and the Pleasanton electorate regarding 
approval of the Bernal Property Development 
Project. 

• There is no assurance or guarantee, if the 
proposed resolution is approved, and the 11.2 
acre parcel is sold to the Pleasanton School 
District, that the City of Pleasanton, which the 
San Francisco has been negotiating with over 13 
years, since 1986, will grant the final approvals 
for the remaining 498.8 acres of the Bernal 
Property Development Project as requested by 
San Francisco. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

48 



P. U.C. GENERAL fWNAGER 



415 554 2161 P.ZZ/Z3 

Attachment 



Beraal Property 

Expenditure Authorizations 
Ai of 3/99 



Consultants 

1 . The Planning Collaboraiivc 

Prime consultant land planning, engineering, 
environmental & economic professional services) 
(6788 to present- approx. S3 5M remaining) 

2. Wendd, Rosen, Black & Dean 

Real estate negotiations & Property Disposition 
(9/97 to present approx. S285M unspent ) 



Authorized 
S4.040.058 



S600.000 

Subtotal 4.640,058 



C'ty Attorney. 

1 . Costs incurred thru FY 98/99 



$1,480,000 



Project Manager 

1. Pre 1995 

2. 1995 to Present 



$138,000 

$340-000 

Subtotal $478,000 



Alameda Painty 

1 . Development Application Processing Costs 



Estimated to Complete , 



$225.000 
Subtotal $6,823,058 

$200.000 
Total 7,023,058 



49 



TDTflL P. 23 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Item 14 - File 98-1443 



Note: This item was continued by the Finance and Labor Committee at its meeting 
of March 10, 1999. 



Department: 
Item: 



Police Department 

Ordinance amending Article 1, Chapter VIII, Part II of 
the San Francisco Municipal Code (Police Code) by (1) 
amending Sections 2.26.1 and 2.27.1, to adjust permit and 
license fees for the operation of motor vehicles for hire 
and to provide a 50 percent discount for four years on 
permit fees for taxicabs and ramped taxicabs operating on 
compressed natural gas; and amending Article 16, 
Divisions I and II; (2) amending Sections 1080 and 1088, 
to require approval for fees in these sections from the 
Board of Supervisors; and, (3) amending Section 1125, to 
include the existing fees for taxicab color scheme permits 
and the proposed fee for taxicab color scheme renewals 
(authorized by these sections) in the permit and license 
fee schedules for motor vehicles for hire. 



Description: 



Section 2.26.1 of the Police Code currently imposes 11 
types of filing fees specifically related to applications for 
Motor Vehicle for Hire permits, which range from a 
permit application filing fee of $53 for a jitney bus driver 
to a permit application filing fee of $347 for a taxicab 
radio dispatch sendee. Such permit application filing fees 
are collected on a one-time basis by the Police 
Department. 

The proposed ordinance would (1) increase the permit 
application fifing fees for five of the 11 Motor Vehicle for 
Hire permits and (2) transfer four filing fees from a list of 
fees charged directly by the Police Commission to the 
schedule of filing fees for Motor Vehicle for Hire permits 
in the Police Code. Attachment I, provided by Officer 
Farrell Suslow of the Police Department, contains the list 
of existing filing fees, the proposed filing fee increases, the 
proposed fee transfers and the dollar and percentage 
increases for each proposed fee change. 

Permit application filing fees are designed to cover the 
cost of all administrative and investigative work of the 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

50 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



Police Department and other City departments, including 
the Fire Department (SFFD), Department of Public 
Health (DPH), the Department of Parking and Traffic 
(DPT), and the Department of City Planing (DCP), for 
processing permit applications, whether or not the 
permits are ultimately granted. The costs of these 
departments are included in the permit application filing 
fee charged by the Police Department. The fees are 
collected by the Police Department and the fee proceeds 
are allocated to the departments that provide services 
related to processing the specific type of permit 
application for which the filing fee was collected. 

Officer Suslow reports that permit application filing fees 
were last increased in June of 1996 (File No. 121-96-7). 
According to Officer Suslow, since this last fee increase, 
the Police Department placed additional emphasis on 
investigations of existing Motor Vehicle for Hire permits 
and thus, hired four full-time Police personnel between 
October of 1996 and June of 1998 to aide in such 
investigations. Attachment II is a letter, provided by 
Officer Suslow, explaining the Police Department's need 
to increase filing fees in order to cover the cost of 
increased Police staff already in place. 

Approval of the proposed ordinance would also amend 
Section 2.26.1 of the Police Code by adding a provision to 
allow for a 50 percent credit against the permit 
application filing fee for each taxicab or ramped taxicab 
operating on compressed natural gas. According to the 
proposed legislation, such credit for compressed natural 
gas vehicles will expire on January 1, 2003. 

Section 2.27.1 of the Police Code currently imposes 10 
types of annual license fees specifically related to Motor 
Vehicle for Hire permits, which range from $29 per year 
for a public passenger vehicle driver to $346 for a taxicab 
radio dispatch service. Such annual license fees are 
payable to the Tax Collector for permits issued by the 
Police Department. 

The proposed ordinance would (1) increase the annual 
license fees for four of the 10 Motor Vehicle for Hire 
permits and (2) add one new annual license fee to the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

51 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



schedule of Motor Vehicle for Hire permits. Attachment I, 
provided by Officer Suslow, contains the existing license 
fees, the proposed license fee increases, the new license 
fee and the dollar and percentage increases for each 
proposed fee change. 

As with permit application filing fees, annual license fees 
are designed to cover the cost of administrative and 
investigative work of the Police Department and other 
City departments, necessary to administer the licensing 
program. Officer Suslow advises that such costs are 
primarily incurred by the Police Department. 

Officer Suslow reports that annual license fees were last 
increased in June of 1996 (File No. 121-96-7). According 
to Officer Suslow, as with permit application filing fees, 
the increased revenues from the proposed annual license 
fees and from the additional license fee for the renewal of 
a taxicab color scheme would be used to cover the cost of 
four full-time Police Department personnel hired between 
October of 1996 and June of 1998 to assist primarily in 
investigations of Motor Vehicle for Hire permits. 

Approval of the proposed ordinance would also amend 
Section 2.27.1 of the Police Code by (1) increasing the 
amount of a credit (from $208 to $220) allowed against 
the license fee for each licensed taxicab operator who 
agrees to participate on a daily basis throughout the 
permit year in the Paratransit Program and (2) adding a 
provision to allow for a 50 percent credit against the filing 
fee for each taxicab or ramped taxicab operating on 
compressed natural gas. According to the proposed 
legislation, such credit for compressed natural gas 
vehicles will expire on January 1, 2003. 

Section 1080 of the Police Code authorizes the Police 
Commission to set permit application filing fees for the 
operation of motor vehicles for hire. Such fees are used by 
the Police Department and other City departments to 
cover the costs of investigating and processing the 
application for each permit. 

The proposed ordinance would amend Section 1080 of the 
Police Code to provide that such fees for Motor Vehicle for 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

52 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Hire permits be approved by the Board of Supervisors (see 
Comment No 1). 

Section 1088 of the Police Code requires the Police 
Department to issue a metallic medallion for each Motor 
Vehicle for Hire permit issued by the Police Department. 
During all hours of operation of a motor vehicle for hire, 
the medallion must be placed in the lower right hand 
corner of the windshield in such a manner that the serial 
number is clearly visible from the exterior of the vehicle. 
Presently, the fee for a metallic medallion is paid once 
each calendar year in an amount determined annually by 
the Police Commission. Such fee is payable to the Police 
Department to cover the costs of producing and processing 
each metallic medallion. 

The proposed ordinance would amend Section 1088 of the 
Police Code to provide that such fees for the metallic 
medallions be approved by the Board of Supervisors. 

Section 1125 of the Police Code requires that upon the 
issuance of a taxicab permit by the Police Department, 
every taxicab permittee is required either to adopt an 
existing taxicab color scheme (i.e. join a particular taxicab 
company with exclusive rights to a distinguishing taxicab 
color scheme) or to establish a new taxicab color scheme; 
in which case, the permittee holds exclusive rights to the 
use of such taxicab color scheme. Taxicab color schemes 
in turn require approval from the Chief of Police. 

The proposed ordinance would amend Section 1125 of the 
Police Code to provide that the fees for taxicab color 
scheme permits, as well as the proposed fees for taxicab 
color scheme changes and color scheme renewals, be 
approved by the Board of Supervisors. 

Comments: 1. Mr. Thomas Owen of the City Attorney's Office advises 

that if the proposed ordinance is approved, the Police 
Code would be amended to include a provision 
authorizing the Board of Supervisors to approve fees 
imposed by the Police Department. Mr. Owens explains 
that the Police Code presently does not reflect the fact 
that the Board of Supervisors is already approving such 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

53 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

fees for Motor Vehicle for Hire permits in accordance with 
the City's Charter. 

2. The proposed ordinance incorrectly refers to the fee for 
a metallic medallion as a metal medallion. The proposed 
ordinance should be amended to properly identify that 
this fee is for a metallic medallion and not a metal 
medallion. 

3. According to Officer Suslow, the Police Department 
collects approximately $500,000 per year in existing 
permit application filing fees and annual license fees, as 
identified in Attachment I of this report. According to 
Officer Suslow x the revised fees and the one new fee would 
generate estimated additional revenues to the City of 
$500,000 annually. Officer Suslow therefore estimates 
that the Police Department would realize total fee 
revenues of an estimated $1,000,000 annually if the 
proposed ordinance is approved. Attachment III is a 
memo, provided by Officer Suslow, containing the 
estimated annual fee revenue data. 

Recommendations: 1. Amend the proposed ordinance by substituting the 

term "metal" medallion with "metallic" medallion in 
accordance with Comment No. 2 of this report. 

2. Approval of the proposed ordinance, as amended, is a 
policy matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

54 



Attachment 



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55 




FREDH-LAU 

CHJE? Of PQUCE 



Auracnemnu xi 
POLICE DEPARTMENT 1 

CITY AND COUNTY OF SAN FRANCISCO 

THOMAS J. CAHU1 HALL Of JUSnC 

SSO BRYANT STOET 
SAN FRANCISCO, CALIFORNIA 94103 



September 18, 1998 



Mr. Gabriel Cabrera 
Budget Analyst Office 
1390 Market St Suite 205 
San Francisco, CA 94102 



Dear Mr. Cabrera: 



During our September 17, 1998 telephone conversation you requested that I send you a 
letter providing information regarding the Board of Supervisors' proposal to change 
permit and licensing fees for the Taxicab Industry. Hopefully, the following responses 
will suffice for your analysis. 

Your first request was for a list of both the existing and proposed fees. Both the existing 
and proposed fees are listed in the draft ordinance. However, I'm sending you a rough 
draft worksheet from last year that also exhibits the fees. 

Primarily you requested an explanation of how the fee changes were calculated. In past 
years fee changes were calculated by simply addin g whatever percentage increase was 
attributable to salary and benefit increases. However, since the last fee increase in 1996 
our overall enforcement focus, as well as our staffing level has dramatically changed. In 
particular we have shifted much of our focus for investigations and enforcement by 
placing additional emphasis on investigations relating to "Permit Holders", "Color 
Schemes" and "Radio Dispatch Services". 

The fees currently before the "Board" were derived by calculating our total costs and then 
raising the fees to equal our costs. Certain fee recommendations such as the "Color 
Scheme" and "Radio Dispatch Service" fees are projected to rise disproportionately as 
- part of an effort to allocate costs more accurately to specific functions. Previous fee 
calculations tended to attribute all such costs within the "Permit Holder" fees. 

Overall, the additional revenue generated by this package of fee increases will cover the 
cost of increased staffing already in place. 



Sincerely, 




icer Farrell Suslow 
Taxicab Detail 



56 



• £3/24/33 10:14 




FRED H. LAU 
CHlEf Of POUCt 



POLICE DEPARTMENT 

CITY AND COUNTY OF SAN FRANCISCO 

THOMAS J. CAHOJ. HAIL Of jUSTC 

£50 BRYANT STREET 
SAN fRANOSCO, CAUfORNIA 94102 



September 24, 1998 



Mr. Gabriel Cabrera 
Budget Analyst Office 
1390 Market Sl Suite 205 
San Francisco, C A 94102 



Dear Mr. Cabrera: 



During our September 22, 1 998 telephone conversation you requested that I send you a 
letter providing information regarding the Board of Supervisors' proposal to change 
permit and licensing fees for the Taxicab Industry. Hopefully, the following responses 
will suffice for your analysis. 

According to projections from the Controller's Office, our rev enues from Taxicab Fees 
have been averaging approximately $500,000 per year for the past few years. The new 
proposed fees would generate slightly over SI, 000,000 per annum. Total costs for 
staffing and expenses will also be at approximately SI, 000,000 per annum. 

The fee proposal includes only one truly new fee, "Color Scheme License Fee". This 
new few should account for approximately S25.0O0 of the new revenue. All other fees 
are either fees currently in the Police Code or hzs being moved to the Police Code from 
the list of fees charged directly be the Police Commission. 



Sincerely, 

■Officer Farrell Suslow 
Taxicab Detail 



57 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 

Item 15-99-0504 



Item: 



Description: 



Hearing to consider the effects of the proposed merger of 
the University of California at San Francisco (UCSF) 
Medical Center and the Stanford University Medical 
Center and its impact on hospital staff, quality of medical 
services, and the community. 

In November 1997, the UCSF Medical Center and the 
Stanford University Medical Center merged. The merger 
involves the Stanford University Medical Center which 
includes Stanford University Hospital and Lucile Salter 
Packard Children's Hospital, and the UCSF Medical 
Center which includes UCSF/Mount Zion, Langley Porter 
Psychiatric Hospital and Clinic, and the clinical practices 
of full-time faculty of the UCSF School of Medicine 
(excluding faculty practicing at San Francisco General 
Hospital) and the Stanford University Medical School. 

Under the merger plan, a new private, nonprofit public 
benefit corporation, UCSF-Stanford Healthcare, was 
formed. UCSF-Stanford Healthcare receives all patient 
revenues from the UCSF and Stanford facilities noted 
above, and is responsible for the operation of all UCSF 
and Stanford clinical facilities. Both Stanford and UCSF 
retained their own separate medical schools, and 
physicians remained employees of their respective 
schools. 



Comment: 



As described in the Attachment provided by Mr. Tony 
Wagner, Executive Administrator of the DPH Community 
Health Network (CHN), the UCSF Medical Center and 
Stanford University Medical Center merger has had no 
impact on the Department of Public Health and CHN p s 
ability to deliver health and medical sen-ices. Neither 
CHNs tertiary care contract with UCSF-Stanford 
Healthcare for Cardiac Surgery and Radiation Oncology 
services nor CHNs affiliation agreement with the UCSF 
Medical School has been affected as a result of the UCSF- 
Stanford merger. Mr. Wagner states that both the 
tertiary care contract and affiliation agreement are 
legally binding contracts which will continue, without 
impact to hospital staff, quality of medical services and 
the community. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

58 



Memo to Finance and Labor Committee 

April 7, 1999 Finance and Labor Committee Meeting 



The tertiary care contract with UCSF-Stanford 
Healthcare for Cardiac Surgery and Radiation Oncology 
services is a one-year agreement for services provided at 
San Francisco General Hospital (SFGH). UCSF-Stanford 
Healthcare provides the tertiary care services. The FY 
1998-99 budget for this agreement is $1,700,000. 

The current affiliation agreement between SFGH and the 
UCSF Medical School remains in effect until terminated 
by either party in accordance with the provisions of the 
agreement. Funding for the affiliation agreement is 
subject to annual appropriation in the SFGH budget as 
approved by the Mayor and the Board of Supervisors. The 
FY 1998-99 budget for the UCSF Medical School 
affiliation agreement is $49,111,622. 




Harvey M. Rose 



cc: Supervisor Yee 

Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 



Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakev 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

59 



ATTACHMENT 



EL, ^^^^ , The Integrated Delivery System 

^ijB Health Network of San Francisco's 

S Of San FranciSCO Department of 'Public Health 



March 31, 1999 



To: Harvey Rose 

Board of Supervisors 
Budget Analyst 

Thru: Mitchell Katz, MD' 

Director, Public Health ] 

From: Anthony G. Wagner \J^ 

Executive Administrator, CHN 

Re: Impact of the UCSF-Stanford merger on the Community Health Network of 
San Francisco (CHN) 



Mr. Rose: 

The CHN has a tertiary care contract with UCSF-Stanford Healthcare, which 
includes the provision of Cardiac Surgery and Radiation Oncology Services. 
There has been no impact on the CHN's ability to deliver services due to the 
UCSF-Stanford merger to date. We also have an extensive affiliation agreement 
with the UCSF Medical School, not UCSF-Stanford Health Care, and there has 
been no effect on this agreement by the UCSF-Stanford merger. 



60 




City and County of £an Francisco 

Meeting Minutes 

Finance and Labor Committee 

Members: Supervisors I. eland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102^»689 



Wednesday, April 14, 1999 



10:00 AM 

Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



DOCUMENTS DEPT. 

JUN 1 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



Meeting Convened 

The meeting convened at 10: 12 a.m. 

REGULAR AGENDA 



990527 [Lease and Sublease for Pier 1 (Embarcadero/Washington Street)] 

Resolution approving lease and sublease with AMB Property Corporation for the Development of Pier 1 
(Embarcadero and Washington Streets) as a maritime office project; approving negative declaration, and 
indemnity agreement. (Port) 

(Fiscal impact.) 

3/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
4/7/99, CONTINUED. Continued to April 14, 1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Paul Osmundson, Deputy Director. Planning 
& Development, Port; Louis Belmonte, Operating Manager, AMB Property Corporation; Dan Cheatham, 
Project Architect; Supervisor Ammiano; Supervisor Bierman; Supervisor Yee. In Support: Stan Smith, S.F. 
Building Trades Council; Bruce Bonacker, S.F Heritage. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 10:08AM on 4/16/99 



Finance and Labor Committee 



Meeting Minutes 



April 14, 1999 



990509 |Property Sale, Alameda County Parcels 16, 16A (Bernal Property)) 
Supervisors Ammiano, Katz, Leno, Becerril, Kaufman, Newsom, Yaki 

Resolution declaring Parcels 16 and 16A of the Bernal Property to be surplus; authorizing the General 

Manager of the Public Utilities Commission to execute a purchase and sale agreement to transfer Parcels 16 

and 16A to the Pleasanton Unified School District; and adopting findings pursuant to the California 

Environmental Quality Act; requesting Public Utilities Commission to report back to the Finance and Labor 

Committee with revenue projections within three months. 

3/15/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 4/14/1999. 

4/7/99, AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE Heard in Committee Speakers: Harvey Rose, 

Budget Analyst; Rick Nelson, Project Manager, Public Utilities Commission; Supervisor Ammiano; Supervisor Yee; Supervisor 

Bierman; Peter McDonald, Pleasanton School District. 

4/7/99, CONTINUED AS AMENDED Continued to April 14, 1999. 

Heard in Committee. Speakers Harvey Rose, Budget Analyst; Rick Nelson, Project Manager; Supervisor 

Ammiano; Supervisor Yee. Amended on page 1, line 8 and page 3. line 19 to change "three" to "two". New 

title. 

AMENDED. 

Resolution declaring Parcels 16 and 16A of the Bemal Property to be surplus; authorizing the General 
Manager of the Public Utilities Commission to execute a purchase and sale agreement to transfer Parcels 16 
and 16A to the Pleasanton Unified School District; and adopting findings pursuant to the California 
Environmental Quality Act; requestmg Public Utilities Commission to report back to the Finance and Labor 
Committee with revenue projections within two months. 
RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990328 [Annual Joint Fundraising Drive] 

Hearing to consider applications from various agencies to participate in the 1999 Joint Annual Fundraising 

Drive. (Finance and Labor Committee) 

2/16/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 02/16/99 - From Bay Area Black United Fund, Inc. 

(BABUF); Combined Health Appeal (CHA). 

02/22/99 - From Local Independent Chanties (LIC). 

02/01/99 - Referred to Finance and Labor Committee. 

02/26/99 - From Earthshare of California; International Service Agencies (ISA); UNITED WAY of the Bay Area. 
03/01/99 - From Mayor's Youth Fund; Mayor's Youth Employment for the Summer Fund, Mayor's Fund for the Homeless 

03/08/99 - Referred to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Steve Nelson, Administrative Services; Jeff 

Mori, Director, Mayor's Youth Fund. 

PREPARED IN COMMITTEE AS A RESOLUTION. 

Resolution designating those agencies qualified to participate in the 1999 Annual Joint Fundraising Drive for 
officers and employees of the City and County of San Francisco. (Finance and Labor Committee) 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Primed at 10:08 AM on 4/1V99 



Finance and Labor Committee 



Meeting Minutes 



April 14, 1999 



990531 [Prevailing Wage) 

Resolution fixing the highest general prevailing rate of wages, including wages for overtime and holiday work, 
for various crafts and kinds of labor as paid for similar work in private employment in the City and County of 
San Francisco at the rates certified to the Board by the Civil Service Commission on October 19, 1998. (Civil 
Service Commission) 

3/19/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Kate Favetti, Executive Officer, Civil Service 
Commission; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990404 (Appropriation, Department of Public Health] 
Supervisor Bierman 

Ordinance appropriating $1,365,293, Department of Public Health, from the General Fund Reserve for 
professional services and materials and supplies to provide increased mental health services for fiscal year 
1998-1999. 

(Fiscal impact.) 

3/1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Jo Ruffin, Director, Mental Health Services; 

Supervisor Ammiano; Supervisor Bierman; Steve Kawa, Mayor's Office. In Support: Jennifer Friederbach. 

Coalition on Homelessness; Mary Kate Conner; Yvonne Mere, Attorney, Homeless Advocacy Project: Rene 

Deger, Mental Health Board; Maggie Cockrell, mental health consumer; Rev. Glenda Hope; Bailey Walker; 

Fred Hobson; Bert Connell. mental health consumer; Bill Hursh, Executive Director Mental Health 

Association; Rosemary Dady, Attorney, Legal Assistance Foundation; Duane Kaufman. Office of Self Help; 

Eve Meyer, Executive Director Suicide Prevention; Jane Kahan, mental health consumer; Lionel Kelly, 

Community Housing Partnership; Dana Cruz Santana, Instituto Familiar de la Raza, Inc.; Chance Martin, 

Coalition on Homelessness; Michele Imai; Daniel O'Connell. Amendment of the Whole appropriating 

SI, 158. 352, recommended; see also divided File 990728. 

DIVIDED. 

Ordinance appropriating $1,158,352, Department of Public Health, from the General Fund Reserve for 
professional services and materials and supplies to provide for Community Mental Health (CMHS) pharmacy 
services for fiscal year 1998-1999. 

(Fiscal impact.) 

RECOMMENDED AS DIVIDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 10: OS AM on 4/W99 



Finance and Labor Committee 



Meeting Minutes 



April 14, 1999 



990728 [Appropriation, Department of Public Health] 

Ordinance appropriating $84,237, Department of Public Health, from the General Fund Reserve for 
professional services to provide increased mental health services for fiscal year 1998-1999. 

(Fiscal Impact) 

Heard in Committee. Speakers. Harvey Rose, Budget Analyst; Jo Ruffin, Director, Mental Health Services; 
Supervisor Ammiano; Supervisor Bierman; Steve Kawa, Mayor's Office. In Support; Jennifer Friederbach. 
Coalition on Homelessness; Mary Kate Conner; Yvonne Mere, Attorney, Homeless Advocacy Project; Rene 
Deger, Mental Health Board; Maggie Cockrell, mental health consumer; Rev. Glenda Hope; Bailey Walker; 
Fred Hobson; Bert Connell, mental health consumer; Bill Hursh, Executive Director Mental Health 
Association; Rosemary Dady, Attorney, Legal Assistance Foundation; Duane Kaufman, Office of Self Help; 
Eve Meyer, Executive Director Suicide Prevention; Jane Kahan. mental health consumer; Lionel Kelly, 
Community Housing Partnership; Dana Cruz Santana, Instituto Familiar de la Raza, Inc. ; Chance Martin, 
Coalition on Homelessness; Michele Imai; Daniel O'Connell. Divided, continued to call of the Chair; see 
also File 990404 . 

CONTINUED AS DIVIDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990245 [Appropriation, Public Utilities Commission) 

Ordinance appropriating 5690,000, Public Utilities Commission, from Water Fund Balance, 5460,000 from 
Hetchy Fund Balance and 5690,000 from Clear Water Fund (a total of 51,840,000) to fund the cost of 
remodeling at 875 Stevenson Street in order to accommodate the PUC staff for fiscal year 1998-1999. 
(Controller) 

(Fiscal impact.) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Phil Arnold, Public Utilities Commission; Supervisor Ammiano; Supervisor 
Yee. Continued to April 21, 1999. 
CONTINUED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990298 [Card Check Ordinance] 

Supervisors Katz, Bierman 

Ordinance amending Administrative Code Sections 23.32, 23.33, 23.34 of the ordinance govemmg labor 
representation procedures in hotel and restaurant developments in which the City has an ongoing proprietary 
interest (The Card Check Ordinance) in order to clarify certain defined terms, notice requirements, contract 
language requirements, exemptions and applicability of ordinance to pre-existing agreements and by adding 
Sections 23.36 and 23.37 regarding effective date, applicability and severability. 

(Amends Sections 23.32, 23.33, 23.34; adds Sections 23.36 and 23.37.) 

2/17/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 3/19/1999 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Billy Blattner, Supervisor Katz's Aide; John 

Holtzman, Deputy City Attorney; Kim Jackson, Local 2, Hotel and Restaurant Workers; Kathleen Harrington. 

Golden Gate Restaurant Association. Supervisors Ammiano and Yee added as cosponsors. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING SAME TITLE. 



City and County of San Francisco 



Printed at 10:09 AM on 4/16/99 



Finance and Labor Committee 



Meeting Minutes 



April 14, 1999 



Ordinance amending Administrative Code Sections 23.32, 23.33, 23.34 of the ordinance governing labor 
representation procedures in hotel and restaurant developments in which the City has an ongoing proprietary 
interest (The Card Check Ordinance) in order to clarify certain defined terms, notice requirements, contract 
language requirements, exemptions and applicability of ordinance to pre-existing agreements and by adding 
Sections 23.36 and 23.37 regarding effective date, applicability and severability. 

(Amends Sections 23.32, 23.33, 23.34; adds Sections 23.36 and 23.37.) 
RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



981935 [Parking Facility Leases and Management Agreements] 
Supervisor Newsom 

Ordinance amending Administrative Code Section 17.1 1 to require that all leases and management agreements 
for parking facilities be awarded through a competitive process and that such parking facility leases and 
management agreements be approved by the Board of Supervisors. 

(Amends Section 17.11.) 

1 1/16/98, ASSIGNED UNDER 30 DAY RULE to Housing and Neighborhood Services Committee, expires on 12/16/1998. 
1/25/99, TRANSFERRED to Finance and Labor Committee. 

2/24/99, CONTINUED TO CALL OF THE CHAIR. Heard in Committee. Speakers: Supervisor Yee; Supervisor Ammiano 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Michael Farrah, Supervisor Newsom's Aide; 
Robert Davis; Supervisor Yee; Supen'isor Ammiano. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING SAME TITLE. 
RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990377 [Appropriation, District Attorney] 

Ordinance appropriating $600,000, District Attorney, of Federal and State Public Assistance for the adaptation 
of San Francisco's Computer Assisted Support Enforcement System (CASES), a child support operating 
system throughout the California counties for fiscal year 1998-1999. (Controller) 

(Fiscal impact.) 

3/8/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 3/15/99 - Clerical correction, $60,000 to read $600,000 
Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Edwina Young, Director, Family Support 
Bureau, District Attorney's Office; Steve Kawa, Mayor's Office. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990582 [Master Lease of Seneca Hotel] 
Supervisor Brown 

Resolution urging the Department of Human Services, through the Tenderloin Housing Clinic, to enter into a 

master lease with the owners of the Seneca Hotel. 

3/29/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Will Lightbourne. Director, Department of 

Human Services; Randy Shaw, Director, Tenderloin Housing Clinic. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 



City and County of San Francisco 



Printed at 10:09 AM on 4/16/99 



Finance and Labor Committee Meeting Minutes April 14, 1999 

Resolution urging the Department of Human Services to enter into a contract with the Tenderloin Housing 
Clinic in order to acquire low-income housing units at the Seneca Hotel for the County Adult Assistance 
Program clients and other low-income persons, and urging the Tenderloin Housing Clinic to enter into a 
master lease with the owners of the Seneca Hotel. 
RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



ADJOURNMENT 

The meeting adjourned at 12:55 p.m. 



City and County of San Francisco 6 Printed at 10:09 AM on 4/1V99 



Public Library, Gov't Information Ctr.. 5 th Fir. 
Attn: Susan Horn, Dept. 41 



'0. 35V 




CITY AND COUNTY ISLSS&oSIJjJ OF SAN FRANCISCO 



BOARD OF SUPERVISORS 



BUDGET ANALYST 



DOCUMENTS DEPT. 
APR 1 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



April 9, 1999 
TO: ^Finance and Labor Committee 

FROM: ^Budget Analyst 

SUBJECT: April 14, 1999 Finance and Labor Committee Meeting 
Item 1 - File 99-0527 

Note: This item was continued by the Finance and Labor Committee at its 
meeting of April 7, 1999. 



Department: 
Item: 



Description: 



Port 

Resolution approving a lease and sublease with 
AMB Property Corporation for the development of 
Pier 1 as a maritime office project and approving a 
negative declaration and indemnity agreement. 

The proposed resolution would (1) approve a 50- 
year lease for Pier 1 with the Port as the lessor and 
AMB as the lessee and (2) approve a sublease for a 
portion of Pier 1 with the AMB as the sublessor and 
the Port as the sublessee. Pier 1 is located 
immediately north of the Ferry Building, on The 
Embarcadero near the intersection with 
Washington Street. Pier 1 is currently owned and 
operated by the Port, which operates a parking lot 
for 221 vehicles on a month-to-month basis. 
According to Mr. Kirk Bennett of the Port, the Port 
currently receives approximately $354,237 of 
annual revenues from Pier 1 parking operations, 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

which comprises one level of approximately 118,313 
square feet of space. 

Under the proposed subject lease with AMB, the 
Port would continue to own Pier 1, but would enter 
into a long-term, 50-year lease with AMB wherein 
AMB would construct and manage a proposed new 
office building. AMB would be responsible for the 
construction costs, for occupying a portion of the 
space, subleasing a portion of the office space to the 
Port and for obtaining tenants for the remaining 
space. Under the proposed subject sublease 
between AMB and the Port, the Port, as the 
sublessee, would pay AMB annual rent of 
$1,836,608 for 52,475 square feet of office space at 
a monthly rate of $2.92 per square feet during the 
first five years of the sublease. This sublease 
includes escalation clauses in the remaining 45 
years of the sublease, in addition to amortized 
tenant improvements at an additional annual 
expense to the Port of $67,000 for the first 15 years, 
for total expenses to the Port of $1,903,608 for each 
of the first five years. In return, AMB, as lessee 
under the subject lease , would pay the Port, as 
lessor, a minimum of $1,782,859 annually, 
although this amount may be reduced depending 
on various factors contained in the lease, as 
discussed in Comment 8, with opportunities for 
sharing additional rental income in the future 
years. At the end of the 50-year lease and sublease, 
the building and all improvements would belong to 
the Port. 

The proposed lease for the new office building at 
Pier 1, is anticipated to begin in August of 1999 
and would contain a total of 190.904 square feet of 
space, including approximately 127.692 square feet 
on the first level and an additional 63.212 square 
feet on a second or mezzanine level. This would 
include 149,687 square feet of office space (78 
percent), 39.341 square feet of public access space 
(21 percent) and 1,876 square feet for the existing 
Pier 1 Deli (one percent). 

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BUDGET ANALYST 

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Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



When the construction of the new office building is 
completed, which is anticipated to be in December 
of 2000, the Port would relocate all of its 
administrative offices from the Ferry Building, a 
City-owned building occupied by the Port at no 
rental cost, to the new Pier 1 office building where, 
as previously noted, the Port would pay rent. In the 
Ferry Building, the Port currently occupies 41,934 
useable square feet, as well as approximately 6,000 
square feet of storage space. As shown in 
Attachment 1, under the proposed lease, the Port 
would occupy 45,630 useable square feet, although 
the rent would be based on a total of 52,475 square 
feet of space, which includes the restrooms, service 
areas, walkwaj^s and other common areas. Mr. 
Bennett reports that the Port is proposing, under 
the subject lease and sublease, to increase its 
current office space due to three factors: (1) 
although most of the Port's storage space of 6,000 
square feet will be moved to a less expensive 
location, some of the proposed new office space at 
Pier 1 will be used for storage; (2) more public 
space, including public meeting rooms and lobby 
area, will be added; and (3) to allow for some 
potential expansion of Port staff over the next ten 
years. Mr. Bennett notes that the proposed office 
space in Pier 1 would enable the Port to increase its 
staff by approximately seven positions over the 
next ten years, at which time further increases in 
office space, would be permitted under the 
sublease. 

Of the remaining 97,212 square feet of office space 
(149,687 total square feet of office space less 52,475 
square feet for the Port), 39,422 square feet would 
be occupied by AMB for their administrative offices 
and approximately 57,790 square feet would be 
leased by AMB to outside tenants for office space, 
with priority given to maritime tenants. However, 
it should be noted that the subject lease does not 
restrict AMB to only maritime tenants for 
occupancy of the new building. 



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BUDGET ANALYST 

3 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

The proposed sublease between AMB and the Port, 
which would begin when the construction is 
completed, in approximately two years, would 
extend for the life of the 50-year lease, or through 
July of 2049. Under the proposed sublease, with 
the Port as the sublessee, the Port would pay AMB 
an initial base rent of $153,051 per month, or 
approximately $2.92 per square foot per month for 
the 52,475 square feet of office space, for a total of 
$1,836,608 per year, which is a rate of $35 per 
square foot per year, for the first five years. This 
base rent would increase by 18.5 percent on the 
fifth anniversary, and adjust to the fair market 
value, as determined by appraisers retained by 
AMB and the Port on each tenth anniversary of the 
50-year sublease. Under the proposed sublease, 
AMB would provide the utilities and the Port would 
provide maintenance services for the subject office 
space. 

On each ten year anniversary, the Port would have 
the option to occupy up to an additional 
approximately 12,000 square feet, for a total 
maximum expansion of 30,000 square feet, at the 
then current fair market value, as determined by 
appraisers retained by AMB and the Port. Mr. 
Bennett reports that although the Port has no 
current plans to expand into this space, the 
proposed sublease would contain this expansion 
potential provision because. Mr. Bennett notes that 
the Port cannot predict what the Port's office space 
needs may be over the next 50 years, which is the 
life of the proposed sublease. According to Mr. 
Bennett, this expansion provision would allow the 
Port the flexibility to decide whether it needs such 
additional space in the future and there is no 
obligation to use such space. The Budget Analyst 
notes that although the Board of Supervisors is 
required to approve the Port's budget, the 
expansion of additional office space for the Port and 
the related funds for that specific purpose is not 
subject to the Board of Supervisors approval. The 
Budget Analyst further notes that the additional 
space of 30.000 square feet would provide the Port 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

with approximately 66 percent more space than the 
45,630 square feet proposed under the subject 
lease. 

As shown in Attachment 1, the estimated total 
construction costs for the proposed Pier 1 project is 
$34,511,526. In addition, as shown in Attachment 
1, excluding the amortized costs of tenant 
improvements, the Port would pay AMB annual 
rent of $1,836,608 at a rate of $35 per square foot 
per year during the first five years of the sublease, 
increasing to $2,176,380 in year six of the sublease, 
with subsequent Port rent increases in future 
3'ears. As shown in Attachment 1, AMB would 
occupy its 39,422 square feet of space on an 
allocated annual cost of $1,576,880, at a rate of $40 
per square foot per year and other office subtenants 
would occupy 57,791 square feet of space at a 
projected rate of $36.50 per square foot per } T ear, for 
revenues of $2,109,370 from these other subtenants 
to AMB in the Pier 1 facility. The Pier One Deli 
would also occupy 1,876 square feet of space in Pier 
1 at a rate of $30 per square foot per year and 
would pay AMB $56,270 annually for rent. Like the 
Port's sublease, all these subleases will provide an 
18.5 percent rental increase on the fifth 
anniversary and adjustments to the fair market 
rent on each tenth anniversary. The estimated total 
annual rental income from the proposed new 
building to AMB, including the rent costs allocated 
to AMB itself of $1,576,880, would be $5,579,127 
during each of the first five years, of the lease, 
increasing to approximately $6,611,265 beginning 
in year six of the proposed sublease. 

Under the proposed lease with AMB, AMB would 
receive a return of 11 percent on their estimated 
construction costs of $34,511,526, or $3,796,268 
annually, for the 50-year life of the lease. Under 
the proposed lease, and as shown in Attachment 1, 
the Port would receive the balance, or $1,782,859 
($5,579,127 annual rent less $3,796,268 return to 
AMB) as the minimum rent, during the first five 
years of the proposed lease. In addition, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

5 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

amortization of additional tenant improvements of 
an additional $10.50 per square foot, above tbe 
standard tenant improvement allowance, are 
estimated to cost the Port an additional $67,000 
per year for 15 years. As a result, during the first 
five years, the Port would pay AMB a net rent of 
$120,749 per year (rental costs of $1,836,608 plus 
$67,000 for tenant improvements less payment of 
$1,782,859 from AMB to the Port). According to Mr. 
Bennett, the "standard tenant improvement 
allowance" equals $32.50 per square foot, which is 
the level of allowance currently being offered by 
office landlords in the marketplace. To complete 
normal tenant improvements, it is expected that all 
of the subtenants will need to contribute to the 
costs of their tenant improvements above this 
allowance. 

Beginning in year six, and continuing for the 
remaining 45 years of the lease, AMB would pay 
the Port 50 percent of the total rental income 
received by AMB, from all of the tenants, including 
the Port and AMB. Mr. Bennett reports that this 
revenue sharing formula in the future years will 
result in a positive net cash flow for the Port. 
Attachment 1 indicates a positive net income to the 
Port of $55,548 beginning in Year 6 of the sublease. 

The proposed resolution would also authorize a 
Port indemnity, as part of the sublease between the 
Port and AMB Property Corporation. This 
indemnity provides that the Port within the 
premises of the sublease would indemnify, defend 
and hold harmless AMB from and against any and 
all Port claims, costs and expenses, except for 
claims arising from active negligence or willful 
misconduct by AMB Property Corporation or its 
agents. The proposed lease also contains similar 
language for AMB to indemnify the Port for all of 
the leased premises. 

Comments: 1. Currently, the Port owns, occupies, leases and 

maintains the Fern' Building for office space for 
commercial tenants and the Port's own 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

6 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



administrative offices. Under this arrangement, the 
Port pays no rent for its administrative offices 
located in the Ferry Building and currently receives 
approximately $1.4 million of annual rent, 
according to Mr. Alec Bash of the Port. However, 
since the Port would move from its existing office 
space in the Ferry Building, to the proposed new 
office building to be constructed under the proposed 
lease and sublease, the Port would have to pay rent 
to AMB to sublease space in the proposed new 
office building at Pier 1. 

Although not the subject of this proposed 
resolution, according to Mr. Bash, the Port issued a 
separate Request for Proposals (RFPs) in 1998 to 
develop the Ferry Building. The Port received four 
responses to this RFP and is currently in exclusive 
negotiations with Wilson Cornerstone to enter into 
a 65-year lease for the Ferry Building, which would 
include seismic upgrading and complete 
renovations of the facility. The renovations would 
include public retail, such as restaurants and fresh 
and prepared food markets on the first floor and 
office space on the top two floors. Mr. Bash 
estimates that construction on the Ferry Building 
is projected to begin in January of 2001 and to be 
completed b} 7 June of 2002. The Port would 
continue to own the Ferry Building and similar to 
the proposed Pier 1 50-year lease, at the conclusion 
of the 65-year lease for the Ferry Building, the 
Ferry Building and all improvements would revert 
back to the Port. 

Mr. Bash reports that under ongoing negotiations, 
which to date are not completed, the Port is 
expected to continue to receive $1.4 million per 
year of rental income from the Fern* Building, to be 
adjusted by the Consumer Price Index (CPI) every 
five years. In addition, Mr. Bash reports that the 
Port would share 50/50 in future Ferry Building 
earnings received by Wilson Cornerstone, after 
Wilson Cornerstone receives an 11 percent return 
on their equity. According to Mr. Bash, it is 
anticipated that, per Wilson Cornerstone's 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

7 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

projections beginning in year 2005, the Port would 
receive an additional $800,000 under this revenue 
sharing arrangement, and that over the first 20 
years of the lease, the Port would receive an 
additional $23 million in revenues in addition to 
the adjusted annual $1.4 million rental income 
from the Fern' Building. 

Mr. Bash reports that in order to renovate the 
Ferry Building, the Port will need to vacate then- 
office premises. Furthermore, Mr. Bash notes that 
when the renovations at the Fern' Building are 
completed, it is anticipated that Fern Building 
office space will rent for approximately $50 per 
square foot per year, which is approximately $15 
more per square foot, than the proposed rent of $35 
per square foot that the Port will pay for office 
space in Pier 1. 

2. According to Mr. Bennett, on March 9, 1999, the 
Port Commission approved a Development 
Agreement with AMB Property Corporation. This 
Development Agreement establishes the conditions 
for (1) the development of Pier 1 by AMB and (2) 
the delivery of the lease and the sublease between 
the Port and AMB for Pier 1. The proposed lease 
and sublease, which are the subject of the proposed 
resolution, are included as Attachments to the 
Development Agreement. This Development 
Agreement will expire when the construction is 
completed and the lease and sublease become 
effective. Mr. Bennett reports that although the 
Port Commission has approved this Development 
Agreement, the Port will not sign this Agreement 
until the proposed lease and sublease are approved 
by the Board of Supenisors. Mr. Bennett notes that 
if the Board of Supen-isors amends either the 
proposed lease or sublease, the Port would have to 
renegotiate the Development Agreement with 
AMB. 

3. Section 9.118(c) of the Charter requires the 
Board of Supendsors approval of leases for uses of 
real property, extending for ten or more years. This 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

8 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Charter Section provides an exemption for leases of 
property under the jurisdiction of the Port 
Commission for maritime use. According to Mr. 
Bennett, although the lease and sublease are for 
predominantly maritime uses, the Port has 
requested and recommended Board of Supervisors 
approval because the Board will be required to 
approve appropriations each year for the Port 
sublease and if the Board fails to do so, AMB may 
offset lost revenues against the lease payments. 

4. The Port issued a Request for Interest and 
Qualification on January 21, 1998 for development 
of Pier 1. According to Mr. Bennett, the Port 
received four responses to this Request from major 
national developers. One of the responders, La 
Salle-ORIX Joint Venture was deemed non- 
responsive because LaSalle did not include a 
required earnest money deposit. Attachment 2 
provided by the Port identifies each of the 
remaining three firms which submitted proposals 
and provides a summary of each proposal, 
including AMB's proposal. As shown in Attachment 
2, AMB Property Corporation had the highest (a) 
Projected Hard Construction Costs ($18,600,000) 
and (b) Projected Total Development Costs 
($23,640,000), although Mr. Bennett reports that 
after an anatysis of the costs was conducted by the 
Port, the estimated hard construction costs and 
total construction costs were found to be even 
higher than those proposed by any of the 
responders. As shown on Attachment 1, the current 
total estimated construction costs are $34,511,526 
for the proposed office building at Pier 1, including 
$28,598,225 in hard costs. On May 26, 1998, the 
Port Commission selected AMB Property 
Corporation to enter into an Exclusive Right to 
Negotiate with the Port for this development 
project for Pier 1, based on the staffs 
recommendation, as shown in Attachment 3, which 
contains the reasons for selecting AMB. 

5. On January 5, 1999, Pier 1 was placed on the 
National Register of Historic Places. Mr. Bennett 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

9 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



reports that having Pier 1 placed on the National 
Register of Historic Places provides (1) an 
expedited California Environmental Quality Act 
(CEQA) review of the proposed project, (2) an 
exemption from the Bay Conservation Development 
Commission's (BCDC) jurisdiction which could 
otherwise limit permitted uses on the pier, and (3) 
potential Preservation Tax Credits for the project. 
The Preservation Tax Credits would enable AMB to 
receive certification from the National Park Service 
that the construction, when completed, complies 
with the Secretary of Interior's Standards for 
Rehabilitation, making the proposed project eligible 
for a 20 percent Federal Historic Preservation Tax 
Credit. The Port will receive 50 percent of the 
benefits of these tax credits in the form of a credit 
against the construction costs applied to the 
formula used to calculate the minimum rent. As 
shown in Attachment 1, the Port would receive a 
credit of $3,031,608 for their portion of the credits. 

6. The State Lands Commission has determined 
that the proposed project is in compliance with 
State Trust purposes, by preserving a maritime 
facility, providing office space for the Port, allowing 
public access and accommodating historic 
preservation of the Ferry Building. 

7. Under the proposed lease, the Port on an 
emergency basis would reserve the right to berth 
vessels adjacent to Pier 1 without AMB's approval 
and on a non-emergency basis, with AMB's prior 
written consent, which could not be reasonably 
withheld, at no cost to the Port. According to Mr. 
Bennett, the Port's proposed lease with AMB 
excludes the berthing areas adjacent to the piers. 
Any berthing revenues from Pier 1 would accrue to 
the Port. 

8. Although Mr. Bennett reports that Attachment 1 
represents the Port's current projection of the costs 
and revenues, there are two conditions which could 
increase the costs for the Port, which are not 
reflected on this Attachment. The first factor is 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

10 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



whether the contractor uses up to a 15 percent 
contingency on the construction and design costs, 
which is valued at $4,289,734 (15 percent x 
$28,598,225), and which would reduce the 
minimum rent paid by AMB to the Port, depending 
on how much of the contingency is required. The 
second factor is whether the Port will receive the 
Historic Tax Credits valued at $3,031,608, which 
would further reduce the minimum rent to be paid 
by AMB to the Port by approximately $333,477 
annually. If the entire 15 percent contingency is 
required by AMB, and the Port does not receive the 
tax credit, then the minimum projected annual rent 
payable by AMB to the Port of $1,782,859 would be 
reduced by $802,226 to $980,633 per year during 
the first five years. 

Mr. Bennett provided documentation to show 
alternative financial scenarios for either or both of 
the above factors. This documentation shows that 
instead of a net rental payment due from the Port 
to AMB of $120,749 in the first five years of the 
lease and sublease, the Port could be liable for up 
to $922,974 per year in rental payments due to 
AMB for each of the first five years. As shown in 
Attachment 1, the Port is anticipated to receive 
$55,548 in net revenues in year 6. However, the 
alternative scenarios indicate that the Port would 
have to pav AMB net rentals of $746,677 in year 6, 
with decreasing net rental amounts up until year 
21 of the proposed lease. After year 21, in all of the 
scenarios, the Port would receive a positive net 
revenue stream. Ms. Stephanie Downs of the Port 
reports that the source of rental paj'ments during 
the initial years of the proposed lease and sublease 
would be the Port's Operating Revenues, which she 
currently projects will have a surplus of $2,027,709 
in FY 2000-2001, when the sublease is anticipated 
to begin. Ms. Downs notes that the Port's FY 1998- 
99 budget includes $939,000 in operating surplus 
funds. 

Over the 50-year term of the proposed lease and 
sublease, the Port is anticipated to receive between 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

11 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



$23.4 million and $63.5 million of net additional 
revenues, or an average of approximately $468,000 
to $1,270,000 per year of additional income, 
depending on which scenario occurs. Mr. Bennett 
notes that AMB is guaranteeing the rent of at least 
$36.50 per square foot for the 57,790 square feet of 
space to be leased by the other office subtenants. 
According to Mr. Bennett. AMB is therefore 
assuming the entire leasing risk and the entire risk 
for construction and design costs above the 15 
percent contingency. 

9. The Budget Analyst notes that none of the above 
analysis conducted by the Port factored in the 
current annual revenue of $354,237 that the Port 
receives from the Pier 1 parking operations, that 
would be lost if the subject lease and sublease are 
approved. Over the 50-year term of the proposed 
lease and sublease, the current annual revenue of 
$354,237 is projected to generate a total of 
approximately $40 million, based on an annual 
inflation rate of three percent. 

Therefore, subtracting the existing Pier 1 annual 
revenues from parking operations from the Port's 
calculations of projected future net additional 
revenues of between $23.4 million and $63.5 
million over the 50-year lease term results instead 
in an overall loss to the Port of approximately $16.6 
million on the low side to a positive revenue stream 
of $23.5 million on the high side. 

Subsequent to this finding by the Budget Analyst 
and disclosure of these facts to the Port, Mr. 
Bennett advised the Budget Analyst that Pier 1 is 
not seismically safe, is currently deteriorating and 
is not likely to be continued for 50 years as a 
parking facility. However, Mr. Bennett could not 
provide an estimate of how long such parking 
operations could be maintained by the Port. 

Based on an April 7, 1999 memorandum from Mr. 
Paul Osmundson, Deputy Director of the Port to 
the Finance and Labor Committee, Mr. Osmundson 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



states that "We believe that the $40 million 
estimate of the value of the parking revenue is too 
high. We agree that it is reasonable to assign some 
value to the parking, but not for the next fifty 
years. For planning purposes, 20 years would be a 
reasonable assumption. This adjustment would 
reduce the lost parking income resulting from the 
project to an estimated $9.5 million." 

Furthermore, Mr. Osmundson writes that "The 
Port views the Ferry Building and Pier One as 
integrally related, since the relocation of the Port's 
offices from the Ferry Building are necessary in 
order to achieve the project." As reported above, the 
Port anticipates receiving an additional income of 
$23 million above the $1.4 million annually 
adjusted income from the Ferry Building project 
over the first 20 years of the project. Even if the 
Ferry Building is not developed, Mr. Osmundson 
reports that the Port's administrative office space 
could be leased for an additional rent of over $27 
million over the next 20 years. Therefore, the Port 
estimates that under the most likely scenario, the 
two projects together, that is Pier 1 and the Ferry 
Building, would generate total net benefits of $59.5 
million over the first 20 years. 

While the Budget Analyst acknowledges this 
additional information, the Budget Analyst 
continues to question why the Port did not include 
the loss of parking revenues in their initial analysis 
and why it was only after the Budget Analyst 
raised this issue that the Port requested that the 
two projects of Pier 1 and the Ferry Building be 
considered together, when reviewing the financial 
impacts of these projects. 

10. Mr. Bennett notes that the proposed 
development of Pier 1 would initially generate over 
$100,000 of new Possessor} 7 Interest Tax revenues 
for the City. Possessory Interest Taxes are a means 
for the City to collect Property Taxes on public 
property that is used for private purposes. Mr. 
Bennett reports that Possessory Interest Taxes are 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

13 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

currently paid by Port tenants to the City's General 
Fund that occupy Port property. However, under 
the proposed sublease, wherein the Port is the 
sublessee, the Port anticipates that it would be 
exempted from Possessory Interest Taxes, although 
the other tenants in the proposed Pier 1 
development would be subject to such Possessory 
Interest Taxes. 

11. The current zoning ordinance requires that a 
specified amount of parking be included in such 
developments. On February 16, 1999 the Planning 
Department granted a parking exemption to the 
proposed development project to enable the 
proposed Pier 1 project to be constructed with no 
parking facilities. Instead, Mr. Bennett reports that 
the Port is encouraging a Transit First policy. 
However, at the same time, the Budget Analyst 
notes that the City's General Fund would lose 
Parking Tax revenues of approximately S68.000 
that are currently generated by the Pier 1 parking 
facility. 

12. Mr. Neil Sekhri of the City Attorney's Office 
reports that both the City and the Port are 
adequately protected under the indemnity 
provisions included in the proposed lease and 
sublease. 

13. The proposed sublease states that if the Board 
of Supervisors does not appropriate adequate funds 
for the Port's rent, AMB may offset its lost Port 
sublease revenues by reducing the amount paid to 
the Port in lease payments, subject to AMB's 
obligation to mitigate any damages by subletting 
this space. 

14. On January 21, 1999, the Planning Department 
issued the Final Negative Declaration for the 
proposed development of Pier 1. This included 
mitigation measures regarding air quality, noise 
and cultural resources due to the proposed 
construction of Pier 1. In addition, in February of 
1999 the Planning Department found that the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

14 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



proposed project is consistent with the Eight 
Priority Policies of City Planning Code Section 
101.1. 

15. The Budget Analyst raises the following 
concerns about the proposed lease and sublease: (1) 
the Port would vacate currently rent-free premises 
in the Ferry Building in order to occupy space in 
the proposed Pier 1 development at an initial net 
cost of $120,749 to $922,974 per year, for at least 
the first five years; (2) the Port would increase its 
useable office space from 41,934 square feet in the 
Ferry Building to 45,630 square feet in the Pier 1 
facility, an increase of 3,696 square feet, or 8.8 
percent; (3) the proposed sublease allows for 
expansion of up to an additional 30,000 square feet, 
or an additional 66 percent increase in space, 
without Board of Supervisors' approval; (4) the 
proposed sublease would require that the Port pay 
for additional tenant improvements above the 
standard allowance of $32.50 per square foot, 
excluding architecture, engineering and general 
conditions at an additional cost of $67,000 per } r ear 
over a 15-year period; (5) although the City's 
General Fund is projected to receive over $100,000 
of Possessory Interest Taxes, the City would forfeit 
approximately $68,000 of Parking Tax revenues 
from the existing facility, (6) the proposed sublease 
states that if the Board of Supervisors does not 
appropriate adequate funds for the Port's rent, 
AMB may offset its lost Port sublease revenues by 
reducing the amount paid to the Port in lease 
payments, subject to AMB's obligation to mitigate 
its losses by subletting the space and (7) the Port 
would forfeit the current Pier 1 annual revenues of 
$354,237, or a projected total of approximately $40 
million over the 50-year term of the lease and 
sublease. 

As a result, the Budget Analyst notes that the Port 
could have a negative net cash flow of an estimated 
$16.6 million on the low side to a positive net cash 
flow of $23.5 million on the high side over the 
proposed 50-year term of the lease and sublease, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

15 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



instead of the Port's reported positive net cash flow 
of between $23.4 million to $63.5 million over the 
50-year term of the lease and sublease. 

16. In summary, the proposed resolution would 
approve a 50-year lease and sublease with AMB 
Property Corporation for the construction and 
development of a new office building at Pier 1. 
Under the proposed sublease, the Port would pay 
AMB $153,051 per month or $1,836,608 per year, 
for the first five years. Including the enhanced 
tenant improvements for the Port, the Port's 
annual rental payments would increase by $67,000 
for the first 15 years, or a total of SI. 903, 608 for the 
first five years. The Port's base rent would then 
increase by 18.5 percent to $2,176,380 in year six, 
or a total of $2,243,380 annually with the 
amortized tenant improvements, with subsequent 
future rental increases over the 50-year term. As 
noted above, the Port currently occupies the Fern- 
Building, rent-free. However, the Port is currently 
in exclusive negotiations with Wilson Cornerstone 
for a 65-year lease for seismic upgrading and 
complete renovations to the Ferry Building, which 
would require all tenants, including the Port, to 
vacate the premises during such renovations. The 
Ferry Building negotiations, which to date are not 
completed, are expected to continue to generate 
$1.4 million per year of rental income to the Port, 
adjusted by the CPI, plus a 50/50 revenue sharing 
in future years. 

Under the proposed lease between the Port and 
AMB, AMB would receive an annual return of 11 
percent on their construction costs of $34,511,526. 
or $3,796,268 per year for the 50-year life of the 
lease. During the first five years, the Port would 
receive the balance from the annual rents received 
by AMB, less the required 11 percent return to 
AMB. This balance would van - from between 
$980,633 to $1,782,859. during the first five years. 
depending on whether AMB requires a 15 percent 
contingency on the construction and design costs 
and whether the Port receives the Historic Tax 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

16 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Credits for this Pier 1 project. Overall, the Port 
could be liable to make rental payments to AMB of 
up to $922,974 for each of the first five years. 

Beginning in year 6 of the proposed lease and 
sublease, the Port would begin to share on a 50/50 
basis the increased rents above the initial projected 
minimum that AMB receives from the subtenants. 
Depending on construction cost contingencies and 
tax credit factors, this shared rental arrangement 
could result in a positive net cash flow for the Port 
beginning anywhere between year 6 and 21 of the 
50-year lease. Overall, the total rental cost to the 
Port would be $222.4 million, or an average cost of 
$4.45 million annually over the 50-year period. At 
the same time, the total revenues to the Port would 
be between $245.9 milhon and $285.9 million over 
the 50-year period, such that the Port estimated 
that it would receive between $23.4 million on the 
low side to $63.5 million on the high side, more 
than the Port spends over the same 50-year period. 

However, the Budget Analyst found that the Port 
had failed to take into consideration the fact that 
the Port currently receives annual revenues from 
parking operations of $354,237 from Pier 1. 
Subtracting these current annual revenues of 
$354,237 over the 50-year term of the lease and 
sublease results in a projected total loss of 
approximately $40 milhon of parking revenues to 
the Port. When considering this loss of revenues 
from the Port's parking operations, this results in a 
negative cash flow to the Port of an estimated $16.6 
milhon on the low side to a positive net cash flow of 
$23.5 milhon on the high side over the 50-year 
term of the proposed lease and sublease, instead of 
the Port's previously reported positive revenue 
calculations of $23.4 milhon on the low side to 
$63.5 million on the high side. 

In response, the Port states that (1) it is more 
reasonable to account for the loss of parking 
revenues for 20 years, rather than 50 years, and (2) 
the Ferry Building and Pier 1 development projects 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

17 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

are integrally related and should be considered 
together for financial purposes. Under the most 
likely scenario, the Port therefore estimates the 
two projects together will generate total net 
benefits of $59.5 million over the first 20 years. 

While the Budget Analyst acknowledges this 
additional information, the Budget Analyst 
continues to question why the Port did not include 
the loss of parking revenues in their initial analysis 
and why it was only after the Budget Analyst 
raised this issue that the Port requested that the 
two projects of Pier 1 and the Fern- Building be 
considered together, when reviewing the financial 
impacts of these projects. 

Recommendation: Approval of the proposed resolution is a policy 

matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

18 



ATTACHMENT 3 
LEASE FOR PiER 1 

3UDGET 



CONSTRUCTION 3UDGET; 



HARD COSTS 
Pier Substructure 
Core & Shell Construction 
Tenant Improvements 
General Conditions 

3onc!s. Insurance, & City Taxes 
Contractor's Ovemead 4 Profit 

Construction & Design Contingency ' 
Cost escalation for 1 Year 



$0,411,000 

12,753,000 

5^86,000 

1.S70.000 



25,520,000 
S2S.000 
SE1.000 



Hard Costs Subtotal 



None 

2.5% 



2S.40S.OOO 



710.225 



Less: Reimbursement of over standard tenant improvements Standard @ 532.50 excluding A£E and general conditions 

Total Hard Costs 
SOFT COSTS 



23,113,225 
(521.000) 



Design & Construction Management Fees 

Testing. Permits & Other Owner Costs 

City Exactions 

FF&E for Common Areas 

Leasing Commissions 

Interest During Construction "• 

Legal & Accounting Fees ** 

Non-Refundable Deposit 

Construction Period Ground Ftent 

Construction Costs Subtotal 

Less: Port's share of Historic Tax Credits 

TOTAL CONSTRUCTION COSTS 



Other Maritime Space @ S10.00 



28.538,225 

4,163,000 
352,000 

1,137,000 
250,000 
577.910 

1,553,000 
400,000 
100,000 



Total Sort Cess 



8.944.910 



X 20% x 85% X 50% ~ 



37,543.135 

(3,03 1.608) 

r 534,511.S26" 



TENANT RENTAL INCOME fTrinle Nefl TO AM3: 


Usable Sq. FL 


Rentable Sq. Ft 
@1S% Load 


Rent Per Sq. Ft 


Rant 
Yearl 


Rent 
Year 6™ * 




Poa space 

Other office subtenants space 

Space occupied by Tenant (AM3) 


45.530 
50.253 
34.280 




52.475 
57.731 
39.422 


535.00 
S36.50 
540.00 


51. 836,608 
2,103,370 
1.576,880 


52,176,380 
2.439.603 
1,868. 603 


Subtotal: Office Space 

Pier One Deli 


130.163 
1.631 




149.637 
1.876 


S30.00 


5,522,857 
56.270 


6,544,586 
65.679 


PROJECTED TOTAL RENTAL INCOME 
[TOTAL RENTAL INCOME 
[EXCESS RENTAL INCOME 


131.794 




151.563 


"■ 


-.$5,573,127^ 
S5.579.127 


$6,611,265 
S1.032.138 



[ LE&SE RENTAL ANA1 YS1S- 

"otal Construction Costs 

PROJECTED TOTAL RENTAL INCOME 
Less: Required Return to Tenant (AM3) 

MINIMUM RENT DUE PORT 
PARTICIPATION RENT DUE PORT 
RENT DUE PORT 

Less: Port Base Rent (Due under Port Sublease) 
Less: Amortization of Port Tenant Improvements over 

Standard pursuant to Port Sublease 
NET Rent Due Port/(Due AMB) 



Rent 
Yearl 



Rent 
Year 6" 



Total Construction Costs @ 11% 

Constant throughout Lease term 

5D% of Excess Rental Income 

Shows Minimum and Participation RenL but 

not Additional Rent 

S1C.50 (estimated) psf 180-month amortization (g 9* 



S34.S11.S26 

5.573.127 
(3.736.268) 



7T~V\ .762.859 ^—^.1 .7E2.85S 
Kt|5S^S^2gi"§51 6.069"! 



g-yc1;7S2-S£3-4^-^2 rse.S2S 



(1,836,608) (2.176,380) 

(67,000) (57.000)1 



£J7T(51 20.7431 5^S5SJS« ; 



Maximum Construction 4 Design Contingency equals fifteen percent (15%) of Hard Costs Subtotal. 
Excludes all points, fees, interest and other expenses regarding permanent /take-out financing 

Assumes that 2C% Ketone Tax Credits sold at es% discount to third party and that 95% of costs eligible. 

Year 6 represents an example for purposes of demonstrating Participation Rent calculation. 

g:\kirk\Pier1Budget 19' 



Attachmen c 2 



Z O ~ ™ 


T 


- S r o 




IHb 


f. 






g; m rn 





2. 3 
? 1 



1 8 5 S S ? 

f 2 £ g s -o 



Zgg 3 

£ o S ~ 



Q 3 — U. 



4 






^ X E 



C T t v 

o J ; » 

= = 



It* o • 
M © ! 

88 



— VI — -o — 



3 r ? ; 



US 



i ? * 



= p 



p » a f 



S 3 

o 5 



S 2 
n J 1 



O 3 O O 
O c O I 

o ^ o 3 



* 3 If 2. 



5.' o 
o o 
i ° 



20 



Attachment: 3 



£=Eii!MJVgNDATTON 

^sm^ST? =Sab! ¥ K:d " *= *™<-Q. &= Pon's project objectives Md r -,. 

apounsats. Port saff recommends thai th- Port r™™,: J . TO and ™e responses of 

>• n- .o„ owlng 6aDn ^ ^ te;s - for ^ ^^^"^tf Pie, 

finai.caSJ.n^ 1 T^ * """ *"*" °P°«<**y to parti* ■ 

JOB or the project, both during negotiations as w .,i J ; '. P ?' Clpats m P°siiive 

4MS\f n , " rUl5,eni i of the lease. 

^ E«ttaSS £S? *? g T' d "^ Provid - ■* -or- te T . 
other Port .„,:• ° La f°° Psnod ,or *" Port to balance the initial ™„ 7™"' aUrin S 

™rove^4 ^T^ "* siz: Md S =°P= * the PonT if. "^ "^ 
- «». and the stze and cuality of public access b££2£ *"* "* Kn ^t 

AMB ProDoSl 3 Sh ,° rai ' te= ttnn (5 ° y =ars > than did Tramm-M r „ 

^ po P.o P osa, enabte ^ Pon „ own fc irnproven* J™^™ <«« ^ Th = 

• njcn 1S a n advantage to 



Prepared by: Paul Osrnundson, Director. Planning & 3. ■ 

HGSNDASVexdusvc ngni «^od« s .Amb.doc\K3\j eW p (V98 



21 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 2 - File 99-0509 

Note: This item was continued by the Finance and Labor Committee at its 
meeting of April 7, 1999. 



Department: 
Item: 



Description: 



Public Utilities Commission (PUC) 
Water Department 

Resolution declaring Parcels 16 and 16A of the 
Bernal Property to be surplus; authorizing the 
General Manager of the Public Utilities 
Commission to execute a purchase and sale 
agreement to transfer Parcels 16 and 16A to the 
Pleasanton Unified School District; and adopting 
findings pursuant to the California Environmental 
Quality Act (CEQA). 

The Bernal Property is approximately 510 acres of 
unimproved land, owned by the City's Water 
Department under the jurisdiction of the PUC. The 
property is located primarily in an unincorporated 
area of Alameda Count}', immediately adjacent to 
the City of Pleasanton. 

The proposed resolution would declare that Parcels 
16 and 16A, which consist of approximately 11.2 
acres of land, or 2.2 percent of the total of 510 acres 
of the Bernal Property, are surplus to the needs of 
the Water Department. Parcels 16 and 16A are 
located at the intersection of Case Avenue and 
Junipero Street, within the Bernal Property 
adjacent to the City of Pleasanton. 

The proposed resolution would also adopt findings 
pursuant to CEQA and would authorize the 
General Manager of the PUC to sell this surplus 
property to the Pleasanton Unified School District 
for the construction of a public elementary school. 

Under the proposed purchase and sale agreement 
between the PUC and the Pleasanton Unified 
School District, the purchase price for the proposed 
11.2 acre parcel would be $6.4 million, or 
approximately $571,429 per acre. However, 
according to the purchase and sale agreement, the 
Pleasanton Unified School District would pay the 
City only $3.0 million of the purchase price in cash, 
at the time of the closing on the property. The 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

22 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



balance, or $3.4 million of the total purchase price 
of $6.4 million, would be allocated as a credit 
toward school developer fees which would 
otherwise have to be paid by the PUC as the owner 
of the Bernal Property when the development 
commences. School developer fees are one of the 
various developer fees (e.g., affordable housing fees, 
park development fees, etc.) that are required to be 
paid by the owner and/or developer of the property 
to the City of Pleasanton, prior to the issuance of a 
building permit. 

According to Mr. Rick Nelson, the PUC's Project 
Manager for the Bernal Property, the Bernal 
Property will be subject to a total of approximately 
$18.2 million of school developer fees to be paid by 
the owner and/or developer of the Bernal Property, 
based on the estimated square footage of the 
residential units proposed to be developed on the 
Bernal Property. The proposed $3.4 million school 
developer fee credit would reduce the estimated 
$18.2 million of school developer fees to $14.8 
million that the owner and/or developer of the 
Bernal Property Development Project would be 
subject to paying. Under specified conditions, these 
$3.4 million of school developer fees credits the City 
would receive under the proposed purchase and 
sale agreement, can be sold by the City and 
effectively transferred to the next owner of the 
property, if the City ultimately sells the Bernal 
Property. 

In addition, the proposed purchase and sale 
agreement states that the purchase price can be 
further adjusted if all of the following three 
conditions are met: (1) on or before July 1, 1999, 
the Pleasanton City Council votes to approve the 
Bernal Property project on the remaining 498.8 
acres (510 acres less the subject parcels totalling 
11.2 acres); (2) the Pleasanton City Council's 
approval of the Bernal Property Development 
Project becomes final and effective and is not 
subject to further legal challenge by January 1. 
2000; and (3) any referendum or initiative vote by 
the Pleasanton electorate on the Bernal Property 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

23 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Development Project occurs at tbe November, 1999 
election and is positive regarding tbe approval of 
the proposed Bernal Property Development Project. 
Although Mr. Nelson could not provide the Budget 
Analyst with any assurances that these three 
conditions would be met, if these conditions are not 
met, then the City would still receive $3 million in 
cash as well as the school developer fee credits of 
$3.4 million. 

Mr. Nelson reports that it is "extremely likely" that 
the Bernal Property Development Project will be 
subject to a referendum or initiative vote by the 
Pleasanton electorate. In fact, Mr. Nelson 
forwarded to the Budget Analyst's Office a copy of 
the text of the Pleasanton Initiative being 
circulated by the Pleasanton Citizens Alliance for 
Public Planning. Mr. Nelson acknowledges that 
there are no guarantees that this citizens' group 
will be successful in either obtaining the necessary 
number of signatures for the ballot or attaining a 
positive vote on the issue. 

However, Mr. Nelson notes that the last two 
development projects approved by the Pleasanton 
City Council were subject to a referendum vote by 
the electorate, and both of these development 
projects were significantly smaller (i.e., one project 
included 300 units and one project included 90 
units) than the proposed Bernal Property 
development project. However, the decision by the 
electorate on any future project is uncertain. 

If all of these three conditions are met, then (1) the 
City would still receive the $3.0 million cash when 
the subject property for the 11.2 acres closes 
escrow; (2) the above-noted school developer fee 
credit of $3.4 million from the Pleasanton School 
District to the City of San Francisco would be 
eliminated, such that the City of San Francisco 
would not receive any school developer fee credits; 
and (3) the City of San Francisco would pay $2.0 
million to a Pleasanton Unified School District 
designated endowment, trust, foundation or other 
non-profit educational organization, by April 29, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

24 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

2000. Under this scenario, the PUC would only 
receive a total of $1.0 million ($3.0 million at the 
close of escrow less $2.0 million paid to a 
designated educational non-profit organization by 
April 29, 2000) out of the purchase price of $6.4 
million, or $5.4 million less than the purchase price 
for the sale of this property to the Pleasanton 
School District. 

Mr. Nelson reports that the proposed $5.4 million 
downward adjustment Goss of $3.4 million in school 
developer fee credits plus $2 million to be paid by 
the City of San Francisco to a non-profit 
educational organization) from the $6.4 million 
purchase price of the 11.2 acre parcel is being 
proposed to build community support in Pleasanton 
for this project. According to Mr. Nelson, this is not 
untypical of the concessions many development 
projects make in order to gain political and public 
favor. Mr. Nelson notes that because school 
overcrowding has become such a public concern in 
Pleasanton, the proposed purchase price reduction 
is being offered as an incentive for the Pleasanton 
City Council to take an approval action on the 
remaining 498.8 acres of the Bernal Property 
Development Project by July 1, 1999 and to build 
community support for the project in the event the 
project approvals are put to public vote. 

Comments: 1. Mr. Nelson advises that the PUC has been 

working with Alameda County since 1994 and the 
City of Pleasanton since approximately 1986 or 
over 13 years to obtain development rights (known 
as land use entitlements) to build a mixed-use 
development on the 510 acres of the Bernal 
Property. Mr. Nelson reports that the planned 
mixed-use Bernal Property Development Project 
currently being negotiated with the Pleasanton 
City Council, which has still not approved the 
Project, would consist of up to 1.900 residential 
housing units, 750,000 square feet of commercial 
office space, an 18-hole public golf course, 40 acres 
of parks and an elementary school which would be 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

25 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



annexed into the City of Pleasanton, if all the 
contemplated development approvals are obtained. 

According to Mr. Nelson, to date, the PUC has 
secured a development agreement and zoning 
reclassification for the development of the Bernal 
Property from Alameda County. However, Mr. 
Nelson reports that the Bernal Property 
Development Project, under the County's 
jurisdiction, still requires many additional 
approvals and permits (e.g., wastewater treatment 
and disposal facilities, water supply system, etc.) 
before the Bernal Property could be developed. Mr. 
Nelson cautions that the PUC's ability to obtain 
these subsequent permits and approvals is 
uncertain and it will take considerable time and 
money to secure these approvals. In addition, Mr. 
Nelson notes that the City of Pleasanton will likely 
pursue legal action over Alameda County's 
approvals of the Bernal Property Development 
Project, which would delay and could possibly 
overturn these County approvals. 

2. However, Mr. Nelson reports, as previously 
noted, that San Francisco still has not yet reached 
final agreement with the City of Pleasanton for the 
Bernal Property Development Project. As noted 
above, the PUC contacts with the City of 
Pleasanton began in approximately 1986, or over 
13 years ago. 

According to Mr. Nelson, to date, San Francisco has 
applied to the City of Pleasanton for land use 
entitlements for the Bernal Property, which 
includes a pre-annexation development agreement, 
specific plan, environmental impact report and 
other land use certifications, agreements and 
approvals for the development of the Bernal 
Property. Mr. Nelson advises that these 
applications by San Francisco for both Alameda 
County and the City of Pleasanton provide for an 
elementary school site on Parcels 16 and 16A. 
However, Mr. Nelson notes that San Francisco did 
not anticipate the sale of the subject Parcels 16 and 
16A prior to the overall development of the rest of 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

26 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



the 498.8 acres of the Bernal Property 
Development Project. 

3. According to Mr. Nelson, the immediate need for 
the Pleasanton public elementary school is in 
response to the State's recent policy of encouraging 
only 20 students per class, which has resulted in 
elementary school overcrowding in Pleasanton. The 
proposed elementary school on Parcels 16 and 16A 
is scheduled to open in September of 2000, or in 
approximately 18 months. Mr. Nelson advises that 
if the City does not sell the proposed parcels to the 
School District, the Pleasanton School District has 
threatened to condemn Parcels 16 and 16A, and to 
use eminent domain powers to take the subject 
property. The Budget Analyst notes that although 
the State may be encouraging only 20 students per 
class in elementary school classes through financial 
incentives to local school districts, the State has not 
imposed any requirements for such reduced class 
size on local school districts nor does the State 
require the construction of this new school. 

4. The Pleasanton Unified School District issued a 
negative declaration for the acquisition and 
construction of the proposed Bernal Property 
Elementary School under the requirements of the 
California Environmental Quality Act (CEQA). On 
March 2. 1999. the PUC passed a resolution 
adopting these CEQA findings and the proposed 
resolution would also adopt similar findings 
pursuant to CEQA. 

5. In August of 1998, the San Francisco Board of 
Supervisors approved a resolution (File 98-1254) 
authorizing the PUC to prepare and solicit 
invitations to bid and/or hold a public auction for 
the sale of the Bernal Property. At the time, the 
PUC indicated that the City could proceed to either 
sell the property outright or partner with a private 
developer and share in the risk and profits. As a 
result, Mr. Nelson reports that the PUC issued a 
request for quotations (RFQ) in November of 1998 
to seek interested parties to bid on the purchase of 
the Bernal Property. According to Mr. Nelson, in 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

27 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

January of 1999, the PUC qualified 12 bidders 
based on their financial status, development 
experience and other factors. Mr. Nelson advises 
that if and when the City of Pleasanton gives their 
final approval for the proposed project, the PUC 
intends to proceed with the selection of a 
purchaser/developer for the remaining 498.8 acres 
of the Bernal Property. 

6. According to Mr. Nelson, the PUC intends to sell 
the remaining 498.8 acres of property outright, 
rather than having the City involved in the 
development of the Bernal Property. Therefore, San 
Francisco would receive a lump sum paj'ment for 
the sale of the property rather than receiving a 
future long-term revenue stream. Mr. Nelson could 
not provide the Budget Analyst with an estimate as 
to the fair market value which such a sale would 
generate. 

In a June, 1994 management audit report of the 
Water Department, the Budget Analyst reported 
with regard to the subject property that the real 
estate development project was "...estimated to 
have a long term net revenue benefit to the City of 
$319 million." However, Mr. Nelson cautions that 
this estimate was based upon a financial 
subconsultant's report which rested on a number of 
assumptions, such as assuming a more conceptual 
project that is considerably different than the 
project currently under consideration and assuming 
that the City would be the sole developer of the 
property. According to Mr. Nelson, since these 
assumptions are no longer applicable, the estimates 
may not have any relevance to today's market. 
However, Mr. Nelson could not provide the Budget 
Analyst with the estimated current value of the 
long-term net revenue benefit to the City, if the 
City were directly involved in the development of 
the project, instead of just selling the property 
outright. 

According to Mr. Nelson, the reason for forgoing a 
future long-term revenue stream and selling the 
property outright is because it was determined by 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

28 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



the PUC that (1) the City would have to incur 
additional risk to develop this property, (2) the 
City's track record thus far on this project has not 
been smooth or easy and (3) the City would not be 
able to move quickly enough, given the numerous 
approvals from the PUC, Board of Supervisors and 
Mayor, that would be required at each step, to 
undertake such a significant development project, 
as the Bernal Property Development Project. The 
final decision on whether to sell or develop the 
property will be subject to the Board of Supervisors 
approval. 

7. As discussed above, the Bernal Property is 
currently located in the unincorporated area of 
Alameda County and the City has received the 
necessary development approvals from Alameda 
County. But, Mr. Nelson notes that the developer 
would need to provide all necessary fire service, 
water, sewer and other infrastructure 
improvements to the site, if the project remains in 
the unincorporated part of Alameda County. 
However, since the property is adjacent to the City 
of Pleasanton, Mr. Nelson notes that the property's 
infrastructure could be integrated with the City of 
Pleasanton's systems, if the project is approved by 
the City of Pleasanton, and the Bernal Property 
subsequently annexed by the City of Pleasanton, 
with much less risk to the developer. 

According to Mr. Nelson, although the PUC still 
intends to sell the remaining 498.8 acres of 
property outright, the PUC is proceeding with 
efforts to secure these final development approvals 
from the City of Pleasanton for the proposed 
development project, rather than selling the 
property without such approvals, due to the 
increased potential sale value of the property to the 
developer if such approvals were obtained prior to 
the property being sold by the City. However, as 
previously noted, Mr. Nelson advises that a current 
appraisal of the potential sale value of the entire 
Bernal Property is not available at this time. 
Furthermore, Mr. Nelson cannot estimate what the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

29 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



current value to the property would be with such 
approvals. 

8. A valuation of the subject 11.2 acre parcel by 
Keyser Marston Associates, Inc. for the PUC, 
indicates the fair market value of the property is 
$6,580,000. As indicated above, the proposed 
purchase price of the property would be $6.4 
million, or $180,000 less than the appraised fair 
market value. 

As previously noted, only $3.0 million of the $6.4 
million purchase price would be received in cash, 
with the $3.4 million balance in school developer 
fee credits. Because the school developer fee credits 
would need to be discounted to induce developers to 
purchase such credits, the Keyser Marston 
Associates, Inc. valuation report indicates that the 
actual cash value of the $3.4 million of school 
developer credits is approximately 80 percent, or 
$2.7 million. Therefore, the total cash value of the 
$6.4 purchase price would actually be $5.7 million 
($3 million cash plus $2.7 million value of school 
developer fee credits), which is $880,000 less than 
the estimated $6,580,000 fair market value of the 
property. 

9. Although the valuation indicated that the fair 
market value of this property is $6,580,000, Mr. 
Nelson indicates that the proposed purchase price 
of $6.4 million, or at a discounted rate of $5.7 
million is reasonable for the PUC to sell the subject 
11.2 acre parcel to the Pleasanton School District 
because (1) it is still a good value for this property, 
(2) if the Pleasanton School District pursues an 
eminent domain action to take this 11.2 acre 
parcel, it is unclear how much the City would 
ultimately receive for the property, and (3) if the 
Pleasanton School District pursues an eminent 
domain action to take this 11.2 acre parcel, the 
other provisions included in the proposed purchase 
agreement would be voided. 

Some of the major provisions included in the 
proposed purchase agreement (1) protect the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

30 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



remaining 498.8 acres of the Bernal Property from 
a possible forced annexation by the City of 
Pleasanton by requiring that the Pleasanton School 
District to vote its property valuation in the 
elementary school site as directed by the City of 
San Francisco, (2) ensure the cooperation by the 
Pleasanton Unified School District on subsequent 
City of Pleasanton and Alameda County approvals 
and (3) require the Pleasanton School District to 
serve students generated by the Bernal Property 
development, regardless of whether the City of 
Pleasanton approvals are received. However, the 
Budget Analyst notes that ensuring the cooperation 
of the Pleasanton Unified School District cannot be 
certain as individuals can change and the same 
individuals can change their position. However, Mr. 
Nelson reports that these provisions are contained 
in the proposed purchase and sale agreement to be 
entered into between the PUC and the Pleasanton 
Unified School District and if the Pleasanton 
Unified School District does not live up to these 
contractual obligations, the PUC could sue the 
District for breach of contract. 

10. As discussed above, the purchase price of $6.4 
million would be adjusted downward to a total of $1 
million (loss of $3.4 million in school developer fee 
credits plus S2 million to be paid by the City of San 
Francisco to a non-profit educational organization) 
if three specific conditions are met by the 
Pleasanton City Council and the Pleasanton 
electorate regarding approval of the Bernal 
Property Development Project. However, Mr. 
Nelson notes that the payment to the non-profit 
educational organization is to be paid 120 days 
after the final and effective project approvals are 
obtained for the remaining 498.8 acre project from 
the City of Pleasanton. Mr. Nelson reports that 
once such final and effective project approvals are 
obtained, the PUC intends to seek approval from 
the PUC and the Board of Supervisors for sale of 
the Bernal Property. Therefore, according to Mr. 
Nelson, it is "unlikely" that San Francisco itself 
will be required to make the S2 million additional 
pajnnent to the non-profit, but rather this 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

31 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

responsibility will be assumed by tbe new owner of 
the Bernal Property. Yet at the same time, that Mr. 
Nelson states it is "unlikely" San Francisco will 
have to pay the $2 million, this subject agreement 
requires the City to pay the $2 million to the non- 
profit organization. Furthermore, Mr. Nelson 
cannot guarantee that the new owner of the project 
will make such payments. 

11. When queried by the Budget Analyst, Mr. 
Nelson responds that there is no assurance or 
guarantee, if the proposed resolution is approved, 
and the 11.2 acre parcel is sold to the Pleasanton 
School District, that the City of Pleasanton will 
grant the final approvals for the Bernal Property 
development project. However, Mr. Nelson notes 
that the City of Pleasanton began a series of public 
hearings on the Bernal Property development 
project on March 30, 1999, that are expected to 
result in a Pleasanton City Council vote on the 
project in June of 1999, in accordance with a 
Pleasanton City staff report. 

12. Mr. Andy Moran of the PUC reports that the 
funds received by the PUC from the sale of the 
proposed 11.2 acre parcel would accrue to the 
Water Department's Enterprise Fund. According to 
Mr. Carlos Jacobo of the PUC, if and when the 
subject 11.2 acre parcel is sold to the Pleasanton 
School District and the Water Department receives 
such revenues, the PUC will request the necessary 
appropriation approvals from the Board of 
Supervisors to expend such additional revenues. In 
addition, Mr. Moran reports that the monies 
received from the eventual sale from the remaining 
498.8 acres of the Bernal Property would also be 
deposited in the Water Department's Enterprise 
Fund. According to Mr. Steven Carmichael of the 
PUC, these funds may be used for the construction 
of a City office building at 525 Golden Gate for the 
PUC and other City departments, which is 
currently estimated to cost approximately $75 
million. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

32 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

13. The Budget Analyst notes that in accordance 
with Charter Section 16.103, receipts from the 
Water Department must be maintained in a 
separate enterprise fund for the Water 
Department. This Charter Section also identifies 
how, and in what specified order, appropriations 
from these Water Department funds must be made. 
In addition, this Charter Section states that if at 
the end of any fiscal year, or as part of the 
budgeting process, the Controller certifies or 
estimates that excess surplus funds of the Water 
Department exist, then such excess surplus funds 
may be transferred by the Board of Supervisors to 
the City's General Fund. 

14. As shown in the Attachment provided by the 
PUC, from approximately June of 1988 through 
March of 1999, the PUC has spent $6,823,058 on 
this Bernal Property development project. In 
addition, as shown in the Attachment, the PUC 
estimates that they will incur approximately an 
additional $200,000 to complete this project, for a 
total estimated City cost of $7,023,058. Of this 
total, approximately $4,040,058 was spent for the 
primary consultant, The Planning Collaborative, to 
assist on this project. Mr. Jacobo reports that 
Water Department revenues were used to pay for 
these expenses. As previously noted, to date, the 
City has obtained initial development approvals 
from Alameda County for the Bernal Property 
development project but, approval by the City of 
Pleasanton has still not been reached. 

15. The Budget Analyst requested Mr. Nelson to 
provide a memorandum explaining the reasons, in 
writing, why this proposed resolution should be 
approved. While Mr. Nelson was cooperative with 
the Budget Analyst and provided detailed 
documentation, Mr. Nelson declined to provide the 
Budget Analyst with a memorandum explaining 
the reasons for approving this resolution. 

Recommendation: In total, the Public Utilities Commission has 

expended over $6.8 million on the Bernal Property 
Development Project and to date, with the 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

33 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



exception of obtaining residential and commercial 
rezoning of tbe project from Alameda County, has 
secured no guarantees that such expenditures will 
result in future economic benefits for the City. The 
Budget Analyst cannot recommend approval of the 
proposed resolution for the following reasons: 

• A valuation of the subject 11.2 acre parcel 
indicates a fair market value of $6,580,000. 
However, the PUC proposes to grant concessions 
to the Pleasanton School District by selling the 
property for $6.4 million, including $3.0 million 
in cash and $3.4 million in school developer fee 
credits. However, the PUC's consultant notes 
that the discounted value of the $3.4 million in 
school developer fee credits, if sold by the PUC, 
would be $2.7 million. Therefore, the sale of the 
property for, in effect, $5.7 million ($3.0 million 
in cash and a market value of $2.7 million in 
school developer fee credits) is $880,000 less 
than the fair market value of $6,580,000. 

• Further, the purchase price of $6.4 million 
would be adjusted downward to a total of $1 
million (loss of $3.4 million in school developer 
fee credits plus $2 million to be paid by the City 
of San Francisco to a non-profit educational 
organization to be designated by the Pleasanton 
Unified School District) if three specific 
conditions are met by the Pleasanton City 
Council and the Pleasanton electorate regarding 
approval of the Bernal Property Development 
Project. 

• There is no assurance or guarantee, if the 
proposed resolution is approved, and the 11.2 
acre parcel is sold to the Pleasanton School 
District, that the City of Pleasanton, which the 
San Francisco has been negotiating with over 13 
3'ears, since 1986, will grant the final approvals 
for the remaining 498.8 acres of the Bernal 
Property Development Project as requested by 
San Francisco. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

34 



n=P -32-1933 10: 12 



P.U.C.GENEPA. rtt^OE?! 



415 554 3161 P.e3/Z2 

Attach] 



Beraal Property 

Expenditure Authorizations 

As of 3/99 



Consultants 

1. The Planning Collaborative 

Prime consultant land planning, engineering, 
environmental &. economic professional services) 
(6788 to present- approx. S3 5M remaining) 

2. Wendd, Rosen, Black &. Dean 

Real estate negotiations & Property Disposition 
(9/97 to present approx. S285M unspent ) 



Authorized 

S4.04O.O58 



S500 000 
Subtotal 4.640,058 



C'ty Attorney 

1 . Costs incurred thru FY 98/99 



Sl.480,000 



Project Man a g-r 

1. Pre 1995 

2. 1995 to Present 



S138.000 

S3A0 000 

Subtotal S478.OD0 



Alameda County 

1 . Development Application Processing Costs 



Estimated to Complete , 



S225.QOO 
Subtotal S5.823.C58 



Total 



S200.000 
7,023,058 



35 



TGT^L P. 23 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 3 - File 99-0328 



Department: 
Item: 

Description: 



Department of Administrative Sendees (DAS) 

Hearing transmitting communications from the Department of 
Administrative Sendees regarding the Annual Joint 
Fundraising Drive. 

Section 16.93-3 of the Administrative Code requires the 
Department of Administrative Services (a) to review all 
applications from charitable organizations which request to 
participate in the City's Annual Joint Fundraising Drive, and 
(b) to recommend to the Board of Supervisors charitable 
organizations which qualify to participate in the City's Annual 
Joint Fundraising Drive in accordance with criteria set forth in 
Section 16.93-2 of the Administrative Code. 

In this subject communication, the Department of 
Administrative Services reports that it has reviewed the 
applications from nine charitable organizations that have 
applied to participate in the City's 1999 Annual Joint 
Fundraising Drive in accordance with the criteria delineated in 
Section 16.93-2 of the Administrative Code. The Department of 
Administrative Services reports that all nine charitable 
organizations comply with the Section 16.93-2 criteria and 
recommends that all nine organizations be approved to 
participate in the City's 1999 Annual Joint Fundraising Drive. 
The summary of findings reported by the Department of 
Administrative Sendees is contained in the Attachment to this 
report. 

Section 16.93-4 of the Administrative Code also requires the 
Board of Supendsors to designate, by resolution, prior to May 1, 
1999, those agencies that qualify to participate in the 1999 
Annual Joint Fundraising Drive. The nine charitable 
organizations that have applied and been recommended by the 
Department of Administrative Services to participate in the 
City's 1999 Annual Joint Fundraising Drive are as follows: 

Bay Area Black United Fund, Inc. 
Combined Health Appeal of California 
Earth Share of California 
Local Independent Charities 
International Sendee Agencies 
Mayor's Homeless Fund 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

36 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Comments: 



San Francisco Youth Fund 

Mayor's Youth Employment for the Summer Fund 

United Way of the Bay Area 

1. Section 16.93-1 of the San Francisco Administrative Code 
states that deductions from employee pay warrants for 
charitable organizations shall only be withheld based upon 
authorizations made by employees in the Annual Joint 
Fundraising Drive. 

2. According to Ms. Jill Lerner of the Department of 
Administrative Services, with the exception of the 
International Services Agencies, all of the organizations 
listed above participated in the 1998 Annual Joint 
Fundraising Drive. Ms. Lerner advises that one other 
organization, namely The Progressive Way, participated in 
the 1998 Annual Joint Fundraising Drive, but did not apply 
for participation in the 1999 Annual Joint Fundraising 
Drive. 



Recommendation: 



Prepare in and report out a resolution designating the nine 
qualifying charitable organizations, as recommended by the 
Department of Administrative Services, to participate in the 
City's 1999 Annual Joint Fundraising Drive. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

37 



Attachment 
Page 1 of 5 



SUMMARY OF FINDINGS 

1999 Reviev of Applications 
To Participate in Annual Fundraising Drive 



SUMMARY OF METHODOLOGY AND FINDINGS 

Our review consisted of an examination of the materials provided in File 99-0328 and telephone 
conversations with representatives from applicant organizations. We were advised by Deputy 
City Attorney Ted Lakey that telephone inquiries were appropriate to clarity information 
supplied by the applicants. This is the same method we have used in past years to prepare this 
reDort to the Board of Supervisors. 

All eight organizations that applied for participation in the 1999 Joint Fundraising Drive were in 
compliance with the criteria established by the Board of Supervisors as delineated in the 
Administrative Code. 

CRITERIA 

Following is a list of the criteria established by the Board of Supervisors and information as to 
how the applicants met each requirement. New legislation enacted in 1997 includes in the 
annual joint fund-raising drive any Mayor's fund which is created to further social causes. 
Under Administrative Code Section 16.93-2, only subsections (b), (c) and (e) apply to the 
Mayor's funds. All other agencies must satisfy subsections (a) through (e). 

Criterion A : Be a federated agencv representing ten ( )0) or more charitable organizations of 
which 50 percent shall represent organizations located in the counties of 
San Francisco. San Mateo. Santa Clara. Alameda. Contra Costa and Marin. 

According to the City Attorney, "located in the counties" may be defined as having offices, 
fundraising or otherwise doing business in those counties. 

1 . Bay Area Black United Fund, Inc. 

Bay Area Black United Fund, Inc. represents over 25 organizations, all of which 
are located in the Bay Area. 

2. Combined Health Appeal 

Combined Health Appeal represents 37 national health organizations of which 
50 percent or more are located in the Bay Area. 



38 



Attachment 
Page 2 of 5 



Summary of Findings 

1999 Review of Applications 

Pase 2 of 4 



3. Earth Share of California (Environmental Federation of California) 

Earth Share of California represents 87 organizations of which 50 percent or more 
are located in the Bay .Area. 

4. Local Independent Charities (LIC) 

Local Independent Charities represents over 150 organizations of which 50 
percent or more are located in the Bay .Area. 

5. International Service Agencies (ISA) 

International Service Agencies represents more than 40 charities of which 50 
percent or more are located in the Bay .Area. 



Criterion B: The federated agencv or Mavor's fund must certify to the Board of Supervisors 
that the Federal Internal Revenue Service has determined that contributions to al 
of the represented charitable organisations or Mavor's funds are tax deductible. 

Based en consultation in years past with the City Attorney, we have concluded that ai! the 
applicants complied with this requirement. 

Criterion C: The federated agencv must have been in existence with 10 or more 

Qualified charities for at least one vear prior to the date of application 
and provide satisfactory evidence to that effect at the time of filing an 
application with the Board Mayor's funds shall submit their most recent 
financial statement to the Board of Supervisors on an annual basis. 

This criterion was met by all agencies. 

Criterion D: The federated agencv must submit its most recent certified audit at the 
time of filing an application with the Board. 

All agencies provided these documents, as detailed below: 

1 • Bay Area Black United Fund, Inc. provided financial statements dated December 3 1 , 

1997 with an accompanying Independent Auditor's Report by Marrecio Coleman, 
CP.A, dated May 26, 1998." 



39 



Attachment 
Page 3 of 5 



Summary of Findings 

1999 Review of Applications 

Pa2e 3 of 4 



2. Combined Health Appeal of California provided financial statements for the year ended 
June 30, 1998. with the Independent Auditors' Report prepared by Rooney, Ida, Nolt and 
Ahem, CPAs, dated July 31, 1998. 

3. Earth Share of California provided financial statements for the three months ended 
September 30, 1997 and for the year ended June 30, 1996; a Report of Independent 
Auditors dated December 9, 1997 by Bregante &. Company, LLP. 

4. International Service Agencies provided financial statements dated June 30, 1998 and 

1997 along with the Independent Auditor's Report by Lang &. Associates dated August 
14, 1998. 

5. Local Independent Charities provided financial statements for the year ended April 30, 

1998 along with the Independent Auditors' Report by Maze & Associates Accountancy 
Corporation dated September 15, 1998. 

6. Mayor's Homeless Fund, created by ordinance (Administrative Code Section 10.1 17-33), 
provided a Statement of Balance dated March 9, 1999. 

7. The San Francisco Youth Fund provided a Statement of Activities for the Year Ended 
September 30, 1997. 

8. Mayor's Youth Employment for the Summer Fund (YES) is served by the Private 
Industry Council ("PIC") as its fiscal agent. The PIC submitted audited financial 
statements for the two year period ended June 30, 1997 with an Independent Auditor's 
Report by Izabal, Bemaciak &. Company dated June 26, 1998. 

Criterion E: Agencies that wish to participate in the Annual Drive are required to submit 
applications to the Board of Supervisors that include all information that may 
be relevant to the criteria listed in the Section. 

As stated earlier in this report, the City Attorney advised that the applications may be considered 
complete although clarification may have been necessary to conduct this review. 

All applicants provided documentation in their letters of application to the Board of Supervisors 
or confirmed by telephone that they are in compliance with the requirements of Section 16.93-2 
which constitutes "certification." 

Therefore, all applicants were in compliance with Criterion E. 



40 



Attachment 
Pa?e 4 of 5 



SUMMARY OF FINDINGS 

1999 Review of Applications 
To Participate in Annual Fundraising Drive 



SUMMARY OF MF.THODOLOGY AND FINDINGS 

Our review consisted of an examination of the materials provided in File 99-0328 and telephone 
conversations with representatives from the applicant organization. We were advised by Deoutv 
City Attorney Ted Lakey that telephone inquiries were appropriate to clarify information 
supplied by the applicants. This is the same method we have used in past years to prepare this 
report to the Board of Supervisors. 

Along with the other eight organizations that applied for participation in the 1999 Joint 
Fundraising Drive, the United Way of the Bay Area was in compliance with the criteria 
established by the Board of Supervisors as delineated in the Administrative Code. 

CRITERIA 

Following is a list of the criteria established by the Board of Supervisors and information as to 
how the applicant met each requirement. 

Criterion A: Be a federated agencv representing ten HO^ or more charitable organization?; of 
which 50 percent shall represent organization? located in the counties of 
San Francisco. San Mateo. Santa Clara. Alameda. Contra Costa and Marin. 

According to the City Attorney, "located in the counties" may be defined as having offices, 
fundraising or otherwise doing business in those counties. 

United Way of the Bay .Area represents 1500 organizations of which 50 percent 
or more are located in the Bav Area 



Criterion B: The federated agencv or Mayor's fund must certify to the Board of Supervisors 
that the Federal Internal Revenue Service ha? determined that contributions to all 
of the represented charitable organizations or Mayor's funds are tax deductible. 

Based on consultation in years past with the City Attorney, we have concluded that the United 
Way of the Bay Area has complied with this requirement. 

Criterion C: Tne federated agencv must have been in existence with 1 or mnr» 



41 



Attachment . 
■Page- 5 of 5 



Addendum Lette 
April 1, 1999 
Pase2 



Qualified charities for at least one vear prior to the date of application 
and provide satisfactory evidence to that effect at the time of filing an 
application with the Board. Mavor's funds shall submit their most rer°nt 
financial statement to the Board of Supervisors on an annual basis. 

This criterion was met by the United Way of the Bay Area. 

Criterion D: Tne federated agencv must submit its most recent certified audit at the 
time of filing an application with the Board. 

Tne United Way of the Bay Area submitted Financial Statements and 
Independent Auditors' Report dated June 30, 1998. 

Criterion E: Agencies that wish to participate in the Annual Drive are required to submit 
applications to the Board of Supervisors that include all information that mav 
be relevant to the criteria listed in the Section. 

As earlier reported the City Attorney advised that the applications may be considered complete 
although clarification may have been necessary to conduct this review. 

As with the other applicants, the United Way of the Bay Area provided documentation in its 
letter of application to the Board of Supervisors or confirmed by telephone that it is in 
compliance with the requirements of Section 16.93-2 which constitutes "certification." 

Therefore, the United Way of the Bay Area was in compliance with Criterion E. 



hi 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 4 - 99-0531 



Department: 



Item: 



Description: 



Civil Service Commission 
Department of Human Services (DHR) 

Resolution fixing the highest general prevailing rate of 
wages which private employers are required to pay 
various craft workers and other laborer positions 
performing labor under City construction contracts. 

The proposed resolution would fix and determine that the 
highest general prevailing rate of wages 1 which private 
employers are required to pay various craft workers 
performing labor under City construction contracts as 
contained in (a) the General Prevailing Wage 
Determination Survey conducted by the Director of 
Industrial Relations of the State of California for all craft 
workers except Garage Attendants and (b) the agreement 
between Parking Employers and Teamsters Automotive 
Employees, Local 665 for Garage Attendants. 

Section 7.204 of the City's Charter requires that City 
contracts for public works or improvements involving 
construction or fabrication shall provide for the payment 
of the highest general prevailing wage rates to all persons 
performing labor under such contracts. 

Section 6.37 of the Administrative Code gives authority to 
the Board of Supervisors to fix and determine the highest 
general prevailing wage rates. To assist the Board of 
Supervisors in determination of these wage rates, the 
Civil Service Commission is required to furnish to the 
Board of Supervisors, on an annual basis, data as to the 
highest general prevailing rate of wages as paid by 
private employers to various craft workers in San 
Francisco. In determining prevailing wage rates, the 
Board of Supervisors is not limited to the data submitted 
by the Civil Service Commission but may consider such 
other information on the subject as it may deem proper. 

The Civil Service Commission determined that the 
General Prevailing Wage Determination Survey 



' A prevailing rate of wage is the rate of compensation being paid to a majority of workers engaged in specified 
category of craft or labor. 

BOARD OF SUPERVISORS 

BUDGET ANALYST 



A3 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



conducted by the Director of Industrial Relations of the 
State of California contains the data as to the highest 
general prevailing rate of wages for various craft workers 
except for Garage Attendants, such as those operating 
and maintaining City-owned parking lots and garages. 
Because the State's General Prevailing Wage 
Determination Survey does not include any data for 
Garage Attendants, the Civil Service Commission used 
the agreement between Parking Employers and the 
Teamsters Automotive Employees, Local 665 as the 
benchmark for the highest general prevailing wage rate 
for Garage Attendants. According to the current five-year 
agreement for the period beginning December 1, 1995 
through November 30, 2000, the highest hourly rate for 
Garage Attendants was $14.25 per hour as of December 1, 
1998. 



Comments: 



1. A copy of the data, submitted to the Board of 
Supervisors by the Civil Service Commission on March 
18, 1999, as to the highest general prevailing rate of 
wages paid by private employers to various craft workers 
in San Francisco is on file with the Clerk of the Board of 
Supervisors. 



2. Ms. Marie McKechnie, Deputy Clerk of the Board of 
Supervisors, states that the Civil Service Commission has 
provided the Board of Supervisors, on an annual basis, 
data as to the highest general prevailing wage rates. 
However, according to Ms. McKechnie, the Civil Service 
Commission has not filed legislation accompanying the 
prevailing wage rate data for Board of Supervisors 
approval since 1994. As a result, since 1994, the Board of 
Supervisors has not approved legislation fixing the 
highest general prevailing rate of wages which private 
employers are required to pay various craft workers 
performing labor under City construction contracts. 



Recommendation: 



Approve the proposed resolution. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 



44 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



Item 5 - File 99-0404 
Department: 

Item: 

Amount: 
Source of Funds: 
Budget: 

Description: 



Department of Public Health (DPH) 
Community Mental Health Services (CMHS) 

Supplemental appropriation ordinance in the amount of 
$1,365,293 from the General Fund Reserve for 
Professional Services and Materials and Supplies to 
provide increased mental health services. 

$1,365,293 

General Fund Reserve 



Professional Services 
Materials and Supplies 
Total 



$806,941 

558.352 

$1,365,293 



Between 1994 and 1998, the Community Mental Health 
Services (CMHS) Division of the Department of Public 
Health (DPH) developed and implemented a managed 
mental health care system in San Francisco. Prior to the 
implementation of this system, access to mental health 
services was limited to only the most chronically mentally 
ill. According to Ms. Louise Rogers of CMHS, by limiting 
access to this narrow target population, CMHS was able 
to provide some mental health services to both Medi-Cal 
beneficiaries and uninsured individuals ineligible for 
Medi-Cal. Under the new managed care system, CMHS 
was required by the State to expand services and access 
beyond the chronically mentally ill population to all Medi- 
Cal beneficiaries who reside in San Francisco. Under the 
managed mental health care system, the City receives an 
allocation from the State based on the estimated number 
of San Francisco Medi-Cal beneficiaries who will require 
mental health services during a given fiscal year, 
regardless of the amount of services that may be provided. 
CMHS's FY 1998-99 budget includes $1,749,120 in State 
and Federal Medi-Cal funding for expanded mental 
health services for San Francisco Medi-Cal beneficiaries. 

The State requires only that San Francisco Medi-Cal 
beneficiaries be included in CMHS's managed mental 
health care system. However, in December of 1997, the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



45 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



City's Health Commission adopted a resolution endorsing 
the expansion of comparable mental health services to 
San Francisco's uninsured and indigent population who 
are ineligible for Medi-Cal. In other words, San 
Francisco's indigent population would be eligible to 
receive the same mental health services, including both 
inpatient and outpatient services, which are currently 
available to Medi-Cal beneficiaries. According to Ms. 
Rogers, establishing a single standard of care for both 
Medi-Cal beneficiaries and indigent residents would be 
beneficial because: 

> Early treatment intervention could be provided to 
indigent individuals in order to prevent the utilization 
of costly acute services at a later date; 

> CMHS would face many practical barriers in 
implementing a plan that offered more extensive 
benefits to Medi-Cal beneficiaries than to indigent 
individuals, given that individuals gain and lose their 
Medi-Cal benefits frequently; and 

> The public mental health system is responsible for 
serving as a safety net for San Francisco residents who 
do not possess insurance coverage or the personal 
means necessary to cover the cost of mental health 
care. 

Although the State did not allocate additional funds to 
San Francisco in order to provide expanded mental health 
services to the indigent population that are comparable to 
the services being provided to Medi-Cal beneficiaries 
under the managed care plan, CMHS started providing 
expanded services to the indigent population in April, 
1998, using existing resources in CMHS's budget. An 
additional $1,000,000 in General Fund monies was 
included in CMHS's FY 1998-99 budget to provide 
expanded mental health treatment services to indigent 
individuals. This $1.0 million was allocated to 
professional services contracts in order to provide 
treatment to indigent individuals through CMHS's 
existing network of private mental health treatment 
providers. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

46 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



CMHS is now requesting an additional $1,365,293 from 
the General Fund Reserve in order to (a) fund a projected 
shortfall of $1,158,352, including $600,000 in Professional 
Services and $558,352 in Materials and Supplies, in 
CMHS's pharmacy budget for indigent individuals for FY 
1998-99, and (b) provide $206,941 in funding for a 
contract with a non-profit agency for one month of 
additional outreach and mental health treatment services 
for the City's under-served populations. This total 
request of $1,365,293 would be expended as follows: 

Professional Services: 

Increase in professional services contract for 

increased pharmacy costs $600,000 

Additional outreach and treatment services 206.941 

Subtotal - Professional Services $806,941 

Materials and Supplies - Pharmaceuticals 558.352 

Total Supplemental Appropriation Request $1,365,293 

Projected Shortfall in Pharmacy Budget ($1.158.352) 

CMHS reports that, based on the number of intake calls 
received during the nine-month period from April 1, 1998 
through December 31, 1998, CMHS projects that an 
additional 2,836 uninsured clients will have been 
authorized for mental health treatment services during 
FY 1998-99. As a result, there has been a related 
increase in CMHS's pharmacy costs for pharmaceuticals 
for these individuals. CMHS's FY 1998-99 budget 
includes $2,394,746 in General Fund monies for 
pharmacy costs for uninsured individuals, consisting of (a) 
$1,200,000 for Professional Services for an existing 
contract with St. Mary's Pharmacy Management Services, 
under which prescription drugs are provided to clients at 
pharmacies throughout the City, and (b) $1,194,746 for 
Materials and Supplies for prescriptions drugs through 
CMHS's in-house pharmacy, located at 1380 Howard 
Street. Based on the number of prescriptions and actual 
expenditures between July 1, 1998 and December 31, 
1998, CMHS is projecting a shortfall of $1,158,352 in its 
pharmacy budget for FY 1998-99, as shown below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

47 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



CMHS's Actual CMHS's Total 

FY 1998-99 Expenditures Projected CMHS's 

Pharmacy 7/1/98 - Expenditures Projected 

Budget 12/31/98 FY 98-99 ShortfaU 



St. Mary's Pharmacy Contract 
CMHS In-House Pharmacy 

Total 

1 Approximate 



$1,200,000 
1.194.746 



$900,000' 
876.549 



$1,800,000 
1.753.098 



$600,000 

668^62 



$2,394,746 $1,776,549 $3,553,098 $1,158,352 



This proposed supplemental appropriation ordinance 
includes $1,158,352 to fund CMHS's projected shortfall in 
its FY 1998-99 pharmacy budget, divided between 
Professional Services ($600,000) and Materials and 
Supplies ($558,352). 



Additional Outreach and Mental Health Treatment 
Services ($206.941) 

The balance of $206,941 of the supplemental 
appropriation request would be used to provide one month 
of additional outreach and treatment services targeted to 
the City's most under-served and difficult to reach groups. 
Ms. Rogers advises that, between April 1, 1998 and 
December 31, 1998, approximately only 50 percent of the 
mental health treatment services authorized by CMHS 
were actually utilized by clients (see Comment No. 3). 
Ms. Rogers advises that only 50 percent of the treatment 
authorized by CMHS was utilized because clients either 
did not show up for appointments or withdrew from 
treatment due to language barriers, stigma, fear, and 
homelessness. Ms. Rogers advises that some types of 
services, such as street-based services and drop-in hours, 
would more likely be used by under-served populations 
than the services currently offered by private 
practitioners in CMHS's existing provider network. As 
such, CMHS is requesting $206,941 in order to contract 
with a community-based non-profit organization to 
provide outreach and treatment services to the City's 
most under-served populations. Ms. Rogers advises that 
CMHS will issue a Request for Proposals (RFP) and 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

48 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 

award a contract to the non-profit agency in May of 1999, 
with a projected start date of June 1, 1999. A breakdown 
of this request for the one-month period from June 1, 1999 
through June 30, 1999 is shown in the Attachment, 
provided by CMHS. 

Ms. Rogers reports that CMHS expects to be able to serve 
an additional 125 clients in the month of June, 1999 
(1,500 clients annually) by providing additional outreach 
and treatment services to the City's under-served 
populations. 

Comments: 1. Ms. Rogers estimates that the annualized cost of the 

proposed supplemental appropriation is $2,399,998, 
consisting of (a) $1,158,352 for CMHS's increased 
pharmacy costs associated with providing expanded 
mental health services to indigent individuals, and (b) 
$1,241,646 for additional outreach and treatment services 
for the City's under-served populations (based on 
annualizing the subject request of $206,941, less one-time 
expenses). The Attachment contains a breakdown of the 
$1,241,646 annualized cost for additional outreach and 
treatment services. Ms. Rogers advises that CMHS has 
included an additional $2,399,998 in its FY 1999-2000 
budget request for the annualization of the proposed 
supplemental appropriation ordinance. 

2. Based on year-to-date actual pharmacy expenditures 
provided by CMHS, the Budget Analyst's projected 
expenditures are $3,581,164 for FY 1998-99, resulting in 
a projected shortfall of $1,186,418 in CMHS's FY 1998-99 
pharmacy budget, as shown below: 

CMHS's Budget Analyst's Budget 

FY 1998-99 Actual Total Projected Analyst's 

Pharmacy Year-to-Date Expenditures Projected 

Budget Expenditures FY 98-99 Shortfall 

St. Mary's Pharmacy Contract $1,200,000 $1,024,361' $1,756,047 $556,047 

CMHS In-House Pharmacy 1.194.746 1.192.566 2 1.825.117 630.371 

Total $2,394,746 $2,216,927 $3,581,164 $1,186,418 

1 July 1, 1998 through January 31, 1999 

2 July 1, 1998 through February 28, 1999 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

49 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



Ms. Rogers advises that the difference of $28,066 between 
the Budget Analyst's projected shortfall of $1,186,418 
shown above and the subject request of $1,158,352 will be 
absorbed with existing funds in CMHS's FY 1998-99 
budget. Therefore, the Budget Analyst recommends 
approval of $1,158,352 to fund the projected shortfall in 
CMHS's FY 1998-99 pharmacy budget. 

3. As previously noted, based on the number of intake 
calls received during the nine-month period from April 1, 
1998 through December 31, 1998, CMHS projects that an 
additional 2,836 uninsured clients will be authorized for 
mental health treatment services during FY 1998-99. In 
addition, CMHS projects that 4,828 new Medi-Cal eligible 
clients will be authorized for mental health treatment 
services during FY 1998-99, for a total of 7,664 new 
clients in FY 1998-99. Of these, CMHS estimates that 
6,344 clients, including 4.128 Medi-Cal eligible clients and 
2,216 uninsured clients, will be referred for treatment to 
private practitioners within CMHS's existing network 
(rather than receiving treatment at DPH's clinics). 
CMHS originally anticipated that, assuming that all 
6,344 new clients authorized for mental health treatment 
actually received treatment, the estimated cost for private 
practitioners to provide treatment to these clients would 
have been $5,252,832 in FY 1998-99, based on CMHS's 
estimated treatment cost of $828 per client. 

However, as previously noted, approximately only 50 
percent of the mental health treatment services 
authorized by CMHS have actually been utilized by 
clients. As a result, actual expenditures for treatment 
services have been lower than anticipated, since private 
practitioners have not billed CMHS for clients who were 
authorized to receive treatment but who failed to appear 
or who withdrew from treatment. Thus. CMHS is 
currently projecting total expenditures for treatment 
services of $2,626,416 for FY 1998-99, or 50 percent less 
than CMHS's original projection of $5,252,832. CMHS's 
FY 1998-9S budget includes $2,749,120 for treatment 
services, consisting of $1,749,120 in State Medi-Cal 
revenue plus the previously cited $1,000,000 in General 
Fund monies. CMHS is therefore projecting a budgetary 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

50 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 



surplus of $122,704 ($2,749,120 less projected 
expenditures of $2,626,416), as shown in the table below: 



Medi-Cal Eligible Clients 
Uninsured Clients 

Total 



Projected No. 

of New Clients 

Authorized for 

Treatment 

4,128 
2.216 

6,344 



Original 

Projected 

FY 1998-99 

Expenditures ' 

$3,417,984 
1.834.848 

$5,252,832 



Revised 

Projected 

FY 1998-99 

Expenditures 2 

$1,708,992 
917.424 



CMHS's CMHS's 

FY 1998-99 Projected 

Treatment Budgetary 

Budget Surplus 



$1,749,120 
1.000.000 



$40,128 
82.576 



$2,626,416 $2,749,120 $122,704 



Based on CMHS's estimated treatment cost per patient of $828 per year. 

Equals 50 percent of original projected expenditures, based on 50 percent of authorized treatment 

being utilized by clients. 

This projected $122,704 surplus in CMHS's current 
treatment budget should be used to partially offset the 
subject request of $206,941 for professional services for 
increased outreach and mental health treatment services 
for the City's under-served populations. Thus, the 
supplemental appropriation request of $206,941 to 
expand mental health services should be reduced by 
$122,704, from $206,941 to $84,237. 

4. Ms. Monique Zmuda of DPH advises that DPH is 
currently facing a projected budgetary deficit of $19.5 
million in its FY 1998-99 budget due to a reduction in 
Medi-Cal revenues and a higher than anticipated census 
at San Francisco General Hospital (SFGH). In addition, 
Ms. Zmuda reports that DPH has had a hiring freeze 
since November of 1998, has deferred capital 
improvement projects, facilities maintenance, and 
equipment purchases, and has made significant 
reductions in administrative costs. The Budget Analyst 
questions whether it is appropriate to approve the subject 
request of $206,941 to expand mental health services at 
the same time that DPH is facing a projected budgetary 
shortfall of $19.5 million in FY 1998-99. Therefore, the 
Budget Analyst considers approval of $84,237 (the subject 
request of $206,941 less the Budget Analyst's 
recommended reduction of $122,704) for the expansion of 
mental health services to be a policy matter for the Board 
of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



51 



Memo to Finance Committee 

April 14, 1999 Finance Committee Meeting 

Recommendations: 1. Approve $1,158,352, including $600,000 for 

Professional Services and $558,352 for Materials and 
Supplies, for the projected budgetary shortfall in CMHS's 
FY 1998-99 pharmacy budget. 

2. Reduce the subject request of $206,941 for the 
expansion of mental health outreach and treatment 
services by $122,704, from $206,941 to $84,237, in 
accordance with Comment No. 3 above. 

3. The Budget Analyst questions whether it is 
appropriate to approve the subject request of $84,237 to 
expand mental health services at the same time that DPH 
is facing a projected budgetary shortfall of $19.5 million 
in FY 1998-99. Therefore, the Budget Analyst considers 
approval of $84,237 (the subject request of $206,941 less 
the Budget Analyst's recommended reduction of $122,704) 
for the expansion of mental health services to be a policy 
matter for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

52 



APR. 7.1999 5= 13PM 



DMS ADMINISTRATION 



Attachment 



Detail for Supplemental Budget Request 



Proposed Budget 




Supplemental 


Description 


Unit Cost 


FY 98-99 


1. Pharmacy Deficit 




$1,156,352 


2. Outreach/Treatment 




including 18% fringe 






Director 


$88,500.00 1 mos 


$7,375 


Peer Ccunselors-5 


$35,400 1 mos 


$14,750 


Clinicians-4 


$70,800 1 mos 


$23,600 


Nurses-1 


$88300 1 mos 


$7,375 


Physicians-3 


$110,000 1 mos 


$27,413 


Eligibility Worker-1 


$29,500 1 mos 


52,458 


Billing Clerk .5 


$15,000 1 mos 


$1,250 


Client Assistance Fund 1 mos 


$1,000 


21% Indirect and opei 


•ating 1 mos 


$17,897 



Temp Shelter/housing $24/day 

Subtotal $103,118 

One time Start Up Costs 

desks-14 $1,500 $21,000 

copier $4,999 $4,999 

filing cabs-6 $500 53,000 

phones-14 $50 $700 

computers/printers 5 $3,000 $15,000 

van-1 $29,000 $29,000 

dualdiagtraining-14 $1,500 $21,000 

cell phone-2 $100 ' $200 

rent deposit 1 mos $8,924 $8,924 

Subtotal $103,823 

Total Outreach/Treatment $206,941 

Total FY 98-99 Supplemental Request $1 ,365,293 



FY 99-00 

$1,158,352 



$88,500.00 

$177,000 

$283,200 

$88,500 

$328,960 

$29,500 

$15,000 

$12,000 

$196,174 

$22,812 

$1,241,646 



4/5/99 



53 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 6 - File 99-0245 



Department: 
Item: 



Amount: 
Sources of Funds: 

Description: 



Public Utilities Commission (PUC) 

Supplemental appropriation of (1) $690,000 from 
Water Fund balance, (2) $460,000 from Hetch 
Hetchy Fund balance and $690,000 from Clean 
Water Fund balance, for a total of $1,840,000 to 
fund the cost of remodeling of office space at the 
875 Stevenson Street building, to be used by PUC 
staff. 

$1,840,000 

$690,000 Water Fund balance 

460,000 Hetch Hetchy Fund balance 

690.000 Clean Water Fund balance 

$1,840,000 Total 

The proposed supplemental appropriation of 
$1,840,000 would be used to fund renovations, 
utility upgrades and furnishings for approximately 
28,241 useable square feet of space, leased by the 
PUC, on the third floor at 875 Stevenson Street. 

PUC's ten-year Capital Improvement Program 
from 1998 through 2008 reflects Program costs to 
improve the system's reliability, water quality and 
water supply at a cost of over $2 billion to complete. 
As part of this effort, in November of 1997, the San 
Francisco voters approved Water System 
Reliability and Seismic Safety Revenue Bonds of 
$157 milli on to provide funds for acquiring and 
constructing reliable and seismic safety 
improvements to the water system and approved 
Safe Drinking Water Revenue Bonds of $147 
million to provide funds for acquiring and 
constructing safe drinking water improvements 
related to the City's water system. The total 
authorized amount for these two bonds is $304 
million. 

According to Mr. Phil Arnold of the PUC, in order 
to undertake these capital improvements for 
improved water treatment facilities, the PUC has 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



54 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

been hiring additional staff for the necessary' 
design and engineering phases of these projects 
with previously approved project funds. Mr. Arnold 
notes that the PUC's 1998-99 budget included 
funds and the authorization to hire 69 new FTE 
positions for the Utilities Engineering Bureau. Mr. 
Arnold reports that there are currently 
approximately 70 employees in PUC's engineering 
section and that the PUC is in the process of hiring 
an additional 50 employees for this section, for a 
total of 120 employees. 

The PUC engineering staff is currently located in 
leased space at 1155 Market Street. These 70 PUC 
engineering positions currently occupy one entire 
floor, or approximately 12,000 square feet. 
Therefore, each of these employees has an average 
of approximately 171 square feet per person. The 
PUC occupies four floors of the 1155 Market Street 
facility, for a total of approximately 48,000 square 
feet. 

Mr. Arnold reports that, by July 1, 1999, the PUC 
plans to locate 111 of the 120 PUC engineering 
employees to the 875 Stevenson Street location, 
which will have approximately 28.241 of useable 
square feet on the third floor for the 120 
engineering positions, or an average of 254 square 
feet for each engineering position. This reflects an 
average increase of 49 percent, from 171 square 
feet to 254 square feet, or an average increase of 83 
square feet per employee when compared with the 
existing staff level and space at 1155 Market 
Street. 

Mr. Steve Legnitto of the Real Estate Department 
reports that the PUC's lease at 875 Stevenson 
Street contains a total of 32.310 square feet, 
including 28.241 directly useable space for the PUC 
and an additional 4,069 square feet for the prorated 
share of the lobby and hallways. Mr. Legnitto 
indicates that based on the total net rentable 
32.310 square feet of space, this lease, including 
utilities, janitorial and security services, will cost 
the PUC approximately $1.78 per square foot per 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

55 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



month, resulting in a monthly total cost of $57,673 
or approximately $692,076 annually. According to 
Mr. Tony DeLucchi of the Real Estate Department, 
the lease costs alone, without utilities, janitorial 
and security services, are approximately $1.33 per 
square foot per month, or $16 per square foot per 
year at 875 Stevenson Street. 

Mr. Arnold reports that in November of 1998 the 
Public Utilities Commission approved this lease at 
875 Stevenson Street for PUC engineering staff to 
occupy the third floor of the 875 Stevenson Street 
building. According to Mr. Legnitto, this space for 
the PUC was not subject to the Board of 
Supervisors approval because the space does not 
represent a new lease for the City. Rather, the City, 
through the Real Estate Department, has an 
existing lease for the 875 Stevenson Street 
building, which was previously approved by the 
Board of Supervisors in 1994 and again amended in 
1996. According to Mr. DeLucchi, now that various 
City departments have moved from 875 Stevenson 
Street to the renovated City Hall, the Real Estate 
Department is backfilling the vacated space at the 
875 Stevenson Street facility, with the concurrence 
of the City Hall Policy Committee. Mr. DeLucchi 
reports that the City Hall Policy Committee, 
comprised of representatives from the Controller's 
Office, Treasurer's Office, Department of 
Administrative Services, Mayor's Office, 
Department of Public Works and other City staff 
representatives, have been meeting for over a year 
to provide direction and reuse of City Hall and the 
surrounding office space in the Civic Center. 

The proposed space to be occupied by the PUC at 
875 Stevenson Street was previously occupied by 
the Controller's and the Assessor's Offices, and for 
storage space for the Treasurer/Tax Collector's 
Office, prior to their move back to City Hall in 
January of 1999. According to Mr. Arnold, 
approximately 25 percent of the 28,241 square feet 
of useable space on the third floor is unfinished and 
was previous^ 7 used for records storage. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

56 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Budget: Tenant Improvements $834,566 



Architectural Fees 


58,420 


Furnishings 


463,221 


Construction Administration 


56,436 


Telecommunications 


117,721 


Moving Expenses 


24.000 


Total 


$1,554,364 



Although the proposed supplemental appropriation 
requests a total of $1,840,000, the current budget 
requirement, as provided by the PUC, the 
Department of Telecommunications and 
Information Services (DTIS) and the Real Estate 
Department, is $1,554,364, or $285,636 less than is 
being proposed in the supplemental appropriation. 
However, as explained in Comment 11 below, the 
Mayor's Office requests that $91,400 of this amount 
be placed on reserve for consideration in connection 
with a future supplemental appropriation involving 
General Fund costs for the 875 Stevenson 
renovation and relocation. 

Attachment 1, provided by the PUC, contains a 
detailed breakdown of the $463,221 being 
requested for all of the furnishings. Attachment 2 
prepared by DTIS identifies the cost breakdown for 
the $117,721 of expenses of the Department of 
Telecommunications and Information Services. 
Attachment 3 provided by the Real Estate 
Department contains a detailed breakdown of the 
$834,566 for Tenant Improvements. The 
Architectural Fees of $58,420, which are seven 
percent of the Tenant Improvement costs of 
$834,566, are to be paid to Komourous-Towey 
Architects (KTA), who was selected by the 
administrator of the Mart, the landlord of 875 
Stevenson Street. The Construction Administration 
Fee of $56,436, which is approximately 4.3 percent 
of the combined Tenant Improvement ($834,566) 
and Furnishings ($463,221) total of $1,297,787, 
which would be paid to the Mart, the landlord of 
875 Stevenson Street, to oversee and manage the 
improvements and furnishings for the leased space. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

57 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Comments: 1. Mr. DeLucchi reports that the $1,554,364 

estimated costs for the PUC to relocate into the 875 
Stevenson Street facility have been revised 
downward from the $1,840,000 initially estimated 
in the subject supplemental appropriation due to 
the Real Estate Department's ongoing negotiations 
with the landlord of the building. According to Mr. 
DeLucchi, the major negotiations with the landlord 
of the 875 Stevenson Street facility for the PUC 
space have been completed, although, as with every 
project, there may be some minor additional 
adjustments in cost for the PUC. 

2. Mr. Legnitto reports that the City originally 
entered into a lease for 150,000 square feet of space 
on five floors at the 875 Stevenson Street facility on 
June 16, 1994. This lease was to expire in 1997, 
although there were two six-month extension 
options. In November of 1996, the Board of 
Supervisors approved an extension of the 875 
Stevenson Street lease until November of 2002, 
because the City needed additional time to occupy 
the building and the City was considering a plan to 
purchase the 875 Stevenson Street facility*. 
According to Mr. DeLucchi, the City is no longer 
considering the purchase of this building. The 
existing lease for the 875 Stevenson Street facility 
has three different options to extend the lease for 
from six months up to a total of 7.5 extra \*ears 
(through May, 2010) beyond the current expiration 
of November, 2002, with the provision that the rent 
would be adjusted to 95 percent of the then 
prevailing market rental rates. 

3. Mr. Legnitto notes that prior to the City 
occupying the 875 Stevenson Street facility 7 in early 
1995, the City spent approximately $5,280,000 to 
renovate and upgrade four floors of this building, or 
an amortized cost over the four-year period that 
these facilities were occupied of approximately 
$1,320,000 per year. Mr. Legnitto reports that the 
Department of Technology and Information 
Services (DTIS) moved in approximately a year 
later in 1996, incurring additional renovation costs 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

58 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

of approximately $1,290,000, for a total renovation 
cost to the 875 Stevenson Street facility of 
$6,570,000. The initial renovation cost of 
$5,280,000 includes approximately $1,362,890 to 
renovate the third floor space, which the PUC is 
now proposing to expend an additional $1,554,364 
to further renovate and upgrade the same space, 
which would result in total renovation and upgrade 
expenses by the City of $8,124,364 for this leased 
facility since just 1995. 

4. According to Mr. Legnitto and Mr. Charles Dunn 
of the Real Estate Department, the reasons the 
PUC needs to spend approximately $1,554,364 to 
renovate and furnish this space after 
approximately $1,362,890 was spent on this same 
space only approximately four years ago is because 
(1) the original $1,362,890 reflected only minimal 
tenant improvements to the space, (2) much of the 
original budgeted improvements, such as carpeting 
and electrical wiring, only had a useful life of three 
years, (3) the Americans With Disability (ADA) and 
other building code requirements have changed and 
(4) whenever one City department is replaced by 
another City department, some renovations are 
always required. Of the total $834,556 of tenant 
improvements, it should be noted that 
approximately $8,000 is to be spent to remove the 
existing carpeting and another $127,048 is to be 
spent on installing new carpeting for the third 
floor. 

5. As previously noted, the City's lease at 875 
Stevenson Street expires in November of 2002, 
although the City has three options to extend the 
existing lease for up to an additional 7.5 years 
(through May, 2010) at 95 percent of the then 
prevailing market rental rates. If the proposed 
supplemental appropriation is approved, the value 
of the tenant improvements ($834,566), 
architectural fees ($58,420), construction 
administration ($56,436) and most of the 
telecommunications ($80,590) costs, totaling 
$1030,012, would be lost if the City vacates the 875 
Stevenson building in 2002, at an amortized cost of 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

59 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



$343,337 per year for these renovations, over a 
three-year period. According to Mr. DeLucchi, it is 
likely, although he can make no assurances, that 
the PUC will remain in the 875 Stevenson Street 
facility for approximately five years, which would 
reduce the amortized cost of the proposed 
renovations to $206,002 per year. Mr. Arnold 
reports that the furnishings to be purchased at an 
estimated cost of $463,221 would all be of a 
modular -type, which would allow the PUC to move 
such furnishings to a new location. 

6. According to Mr. Legnitto, since the proposed 
lease was renegotiated in 1996, when lease rates 
were less expensive, the existing proposed lease 
rate of $1.33 per square foot per month payable by 
the PUC represents less than the current fair 
market value for such a building. Mr. DeLucchi 
estimates that the fair market value rate for a 
comparable lease is approximately $1.75 per square 
foot per month at this time, or approximately $.42 
per square foot per month more than the rate at 
875 Stevenson Street. Mr. DeLucchi notes that 
fully servicing the 875 Stevenson Street lease, 
which would include providing utility, security and 
janitorial costs, increases the 875 Stevenson facility 
costs to $1.78 per square foot per month, and that 
comparable servicing costs would be added to other 
market rate leases. 

7. Mr. Arnold reports that the space proposed to be 
vacated, when approximately 70 engineering staff, 
currently located at 1155 Market Street, are 
relocated to 875 Stevenson Street, would be used 
for the PUC's project management, construction 
management and contract management staff, that 
are also currently expanding due to the capital 
improvement projects that need to be completed 
over the next ten years. According to Mr. Arnold, 
under the proposed supplemental appropriation, all 
new furnishings would be purchased for the 875 
Stevenson Street facility. As shown in Attachment 
4, provided by Mr. Arnold, a total of 66 new staff 
positions, subject to Board of Supervisors approval, 
are anticipated to be added from FY 1998-1999 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



60 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



through FY 2000-2001, to be located at 1155 
Market Street, such that the existing furnishings 
at 1155 Market Street need to remain there for use 
by these new PUC staff that would use that 
vacated space. 

When queried by the Budget Analyst regarding the 
need for an additional $463,221 of new office 
furniture, Mr. Arnold responded that this would 
provide all new office furnishings for the 111 staff 
that would be relocated to 875 Stevenson Street. A 
review of the specific furnishings reveals that the 
PUC is requesting to construct and furnish four 
conference rooms (one large and three small) and 
15 private offices, in addition to 96 work stations 
for the engineering and support staff. Mr. Arnold 
notes that the PUC engineering staff at 1155 
Market Street currently have three small 
conference rooms and five private offices, and that 
given the number of staff working together on 
various projects, there is a great need for 
conference rooms and private offices where the staff 
can work together on projects. Although the 
proposed renovations and furnishings will result in 
an increase of one conference room and ten private 
offices, it is difficult for the Budget Analyst to 
identify whether such an increase is the 
appropriate number of conference rooms or private 
offices for the expanded needs of the PUC. 
Similarly, it is difficult for the Budget Analyst to 
determine what individual pieces of furniture are 
necessary, or whether the type of furniture selected 
is the most appropriate, efficient and economical 
for the PUC. However, the Budget Analyst does 
question the overall purchase of new furnishings 
for new capital project staff in this temporary 
leased facility, given the fact that it is likely that 
the PUC will be moving all of its staff to a new 
facility at 525 Golden Gate Avenue in 
approximately five years, and it is likely that the 
PUC will be requesting new furnishings to be 
purchased at that time. 

8. The proposed source of revenues to pay for this 
supplemental appropriation are each of the utility's 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



61 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Fund balances. The current fund balance in the 
Water Fund is $27,938,000. The current fund 
balance in the Hetch Hetchy Fund is $1,487,000. 
The current fund balance in the Clean Water Fund 
is $47,745,000. Mr. Arnold reports that these fund 
balances are a result of revenues received from 
water and sewer service rates charged to PUC's 
customers. In June of 1998, San Francisco voters 
approved Proposition H, which froze water and 
sewer service rates until July 1, 2006, except in 
certain circumstances. Therefore, Mr. Arnold 
reports that the proposed supplemental 
appropriation cannot result in increased rates to 
PUCs customers until at least July 1, 2006. 

9. Although not the subject of the proposed 
supplemental appropriation, Mr. Ben Rosenfield of 
the Mayor's Office reports that staff from four other 
City departments, in addition to the PUC, are 
scheduled to be relocated to the 875 Stevenson 
Street facility. Mr. Rosenfield notes that a total of 
$464,880 of General Fund revenues were placed on 
reserve by the Board of Supervisors in the FY 1998- 
99 budget of the Department of Real Estate to 
finance the costs of renovations and furnishings at 
875 Stevenson Street for these four General Fund 
departments. According to Mr. Rosenfield, the 
Department of Real Estate anticipates requesting 
the release of these General Fund monies in the 
near future, but is not currently ready to request 
the release of such funds at this time, or to provide 
detailed information on the amount of space and 
the costs for each of the four General Fund 
departments. 

10. However, the four General Fund departments 
that are proposed to relocate into 875 Stevenson 
Street and a general description of where the 
Departments are currently located is as follows: (1) 
The Public Administrator-Guardian, which is 
currently located at 25 Van Ness, a City-owned 
building. It is anticipated that the 25 Van Ness 
vacated space would then be occupied by the 
Department of Parking and Traffic for their new 
Traffic Control Center and for their relocated 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

62 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Residential Permit Parking Program, which is 
currently located in the Performing Arts Garage. 
(2) The Controller's Payroll and Personnel Division, 
which is currently located in leased facilities at 160 
South Van Ness. According to Mr. Legnitto, the 
lease on the facilities at 160 South Van Ness 
expires on June 30, 1999 and an extension of this 
lease is currently being renegotiated by the Real 
Estate Department for use by the Department of 
Human Services (DHS) for their new hires and to 
relocate staff from other DHS work sites. (3) 
MUNI's Management Information System (MIS) 
and Security, which is currently located at 425 
Mason Street, the Presidio facility and on Turk 
Street, in order to consolidate such staff in the 
Civic Center area. (4) Assessor's staff, currently 
located on the third floor of 875 Stevenson would be 
relocated to the ground floor of the 875 Stevenson 
leased facility in order to consolidate the Assessor 
and Recorder functions on the first floor and to 
provide the entire third floor for use by the PUC. 

11. Mr. Rosenfield requests that the Board of 
Supervisors reserve $91,400 of the supplemental 
appropriation request of $1,840,000 for the 
anticipated costs of relocating the Assessor's Office 
from the third floor of 875 Stevenson to the first 
floor so that the PUC can relocate to the third floor. 
Mr. Rosenfield notes that the Assessor would not be 
required to move except for the fact that the PUC is 
requesting the use of the entire third floor. The cost 
of this move, Mr. Rosenfield states, should 
therefore be attributed to the PUC, and not to the 
General Fund. 

12. The Budget Analyst notes that when City 
employees moved back into City Hall in January of 
1999, a total of approximately $5 million in various 
types of furniture and equipment was provided for 
these employees. Many of these City employees, 
including employees from the Treasurer/Tax 
Collector's Office, Recorder/Assessor's Office, 
Controller's Office, etc. were previously located at 
875 Stevenson Street. According to Mr. DeLucchi, 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



63 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



those furnishings were left behind at 875 
Stevenson Street. 

When queried regarding why the PUC could not 
make use of this remaining furniture at 875 
Stevenson Street, Mr. Rosenfield reported that the 
furnishings remaining at 875 Stevenson, that are 
in good shape, would be used by the four General 
Fund departments that are proposed to occupy 875 
Stevenson Street. However, Mr. Rosenfield also 
advises that these General Fund departments will 
also be purchasing some additional new 
furnishings, although the amounts and costs of 
such new furnishings are not available at this time. 
Because the request for release has not yet been 
made for the $464,880 for renovations and 
furnishings at 875 Stevenson Street for the four 
General Fund departments, the Budget Analyst 
cannot determine to what extent that the furniture, 
now remaining used at 875 Stevenson Street could 
be reused by these General Fund departments, and 
therefore eliminate the need for at least a portion of 
the subject $463,221 in requested new funds for 
PUC furnishings. 

13.The Budget Analyst also notes that, according to 
Mr. DeLucchi, approximately 66,500 square feet of 
the total approximately 150,000 net rentable 
square feet at the 875 Stevenson Street facility is 
currently vacant. At a lease cost of $1.33 per square 
foot per month, excluding utilities, security and 
janitorial services, the City is currently spending 
approximately $88,445 per month for this vacant 
space. The Budget Analyst notes that City 
employees vacated the 875 Stevenson Street 
facility in December of 1998 and January of 1999, 
and that it is not anticipated that the PUC or other 
City departments would be able to relocate into 
this space until at least the Summer of 1999, 
leaving this space vacant for at least six months, at 
an approximate cost of at least $530,670 to the 
City. 

However, Mr. Rosenfield reports that the PUC's 
budget for FY 1998-99 included rent for the third 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



64 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



floor space from the beginning of January of 1999 
through the end of the current fiscal year. 
Therefore, Mr. Rosenfield reports that the PUC will 
pay rent for this leased from January of 1999 
through the time the PUC actually moves into the 
leased space. Assuming the PUC moves into the 
875 Stevenson Street facility on July 1, 1999, they 
will be paying a total of approximately $346,038 for 
the six-month period for which they did not occupy 
this space. 

14. In summary, the Budget Analyst raises the 
following concerns about the proposed 
supplemental appropriation: (1) the 49 percent 
average increase of space per staff position from 
approximately 171 square feet per person at 1155 
Market Street to 254 square feet per person at 875 
Stevenson Street, (2) the existing lease at 875 
Stevenson Street expires in November of 2002, 
although there are options to extend the lease up to 
7.5 years, with rent adjustments to 95 percent of 
the then fair market rate, (3) the City has already 
spent $6,570,000 to renovate this building, of which 
$1,362,890 included renovations to the third floor, 
(4) the $6,570,000 previously spent and the 
proposed supplemental appropriation of 
$1,554,364, to again renovate the third floor, only 
approximately four years after the initial 
renovations to the third floor, results in a total of 
$8,124,364 to be spent on this leased facility since 
1995, (5) whether the increased number of PUC 
conference rooms, private offices and the type of 
furniture are appropriate, efficient and economical, 
given that the PUC will likely be moving to a new 
permanent facility in approximately five years, and 
will likely be requesting new furnishings at that 
time, (6) $464,880 of General Fund monies are on 
reserve for additional renovation and furnishing 
costs for 875 Stevenson Street for four City 
departments, and is not available for review at this 
time, (7) an additional $91,400 is requested by the 
Mayor's Office from the subject PUC supplemental 
appropriation for the Assessor's Office, although no 
details are currently available and the funds were 
not included in the original PUC or Mayor's 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

65 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

supplemental appropriation request, (8) the City 
has an ongoing lease to occupy the current vacant 
space and is therefore paying rent on this vacant 
space at a rate of $88,445 per month, (9) the PUC 
will pay rental costs for the approximately six- 
month period that they have not occupied the third 
floor space. 

Recommendations: Amend the proposed ordinance to reduce the 

supplemental appropriation from $1,840,000 to 
$1,645,764, a savings of $194,236, and reserve 
$91,400 for the cost of the relocation of the 
Assessor's Office, as explained in the Budget 
section and Comment 11 of this report. 

Approval of the proposed supplemental 
appropriation, as amended, is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

66 



ftLiacnmeni l 
^age 1 of 4 



875 Stevenson 
Furnishing Cost Estimate 



Tvoe of Space 


Qnty. 




Cost/item 




Total 


Work Station 


96 


$ 


4,025 


$ 


386,400 


Private Office 












Bureau Mgr. 
Section Mgr. 
Supervisor 


1 

4 
10 


S 
$ 
S 


4.206 
3,855 
2,539 


$ 
$ 
$ 


4,206 
15,420 
25,390 


Conference Room 
Small 
Large 


3 
1 


s 
$ 


4,855 
9,265 


$ 
$ 


14,565 
9,265 


Reception 


1 


s 


604 


$ 


604 


Sub-total: 








$ 


455,850 


Misc. 

Lateral Files 


17 


s 


260 


$ 


4,416 


Bookshelves 


20 


$ 


148 


S 


2,956 



Total: 



463,221 




67 



Attachment 1 
Page 2 of 4 



875 Stevenson 
Furnishing Cost Estimate 



Item 



Work Station, Typical 



Item Description 



Modular Workstation Herman Miller Series 2 

(includes panels, worksurfaces, overhead cabinet, 
pedestal cabinet, task light) 

Keyboard Tray Workrite Straightway w/ adjustable Arm 

Ergonomic Chair Eckadams Task Chair w/ arms, burgundy 

Vertical File HON Vertical File, legal, 4 drawer, grey 

Bookshelf HON Bookcase, 47"h, grey 



Unit Cost 
$ 5,000.00 

$ 312.00 

S 435.00 

S 275.00 

$ 161.00 



Qnty. 



List Price: 



Cost 
1 $5,000.00 

1 S 312.00 
1 S 435.00 
1 S 275.00 
1 S 161.00 
$6,183.00 



City's Price (40% discounts tax): $4,025.13 



Bureau Manager's Office 



Desk 



Keyboard Tray 
Bookshelf 
Ergonomic Chair 
Conference Table 
Side Chair 



HON 10700 Radius Edge Series, U-grouping, Medium Oak 

Peninsula Top w/ Edge Panel $ 639.00 

Bridge $ 218.00 

Lateral File w/ Credenza $ 909.00 

Lateral File $ 596.00 

Overhead Storage Unit $ 855.00 

Workrite Straightway w/ adjustable Arm $ 312.00 

HON Bookcase, 47 - h, black $ 1 61 .00 

Eckadams High Back Chair w/ arms, burgundy $ 555.00 

HON Rectangular Table, 36"x72", Med. OaK S 525.00 

HON Guest Arm Chair, Oak/Burgundy S 255.00 

List Price: 



1 S 639.00 

1 S 218.00 

1 S 909.00 

1 S 596.00 

1 S 855.00 

1 S 312.00 

2 $ 322.00 
1 S 555.00 
1 S 525.00 
6 S 1,530.00 

$6,461.00 



City's Price (40% discounts tax): S 4,206.1 1 



Section Manager's Office 

Desk HON 10700 Radius Edge Series, U-grouping, Medium Oak 



Keyboard Tray 



Peninsula Top w/ Edge Panel 

Bridge 

Lateral File w/ Credenza 

Lateral File 

Overhead Storage Unit 

Workrite Straightway w/ adjustable Arm 



$ 639.00 

$ 218.00 

$ 909.00 

$ 596.00 

$ 855.00 

$ 312.00 



1 $ 639.00 

1 $ 218.00 

1 $ 909.00 

1 $ 596.00 

1 $ 855.00 

1 $ 312.00 



68 



875 Stevenson 
Furnishing Cost Estimate 



Item 

Conference Table 
Bookshelf 
Ergonomic Chair 
Side Chair 



Supervisor's Office 
Desk 



Keyboard Tray 
Bookshelf 
Ergonomic Chair 
Side Chair 



Item Description Unit Cost 

HON Round Table. 42'd, Medium Oak S 495.00 

HON Bookcase, 47" h, black S 161 .00 

Eckadams High Back Chair w/ arms, burgundy S 555.00 

HON Guest Arm Chair, Oak/Burgundy S 255.00 

List Price: 



fage 3 of h 



Qnty. Cost 

1 S 495.00 

2 S 322.00 
1 S 555.00 
4 S 1.020.00 

S 5.921.00 



City's Price (40% discount & tax): S 3,854.57 
Total Cost/Floor. 



HON 10700 Radius Edge Series, U-grouping, Medium Oak 

Peninsula Top w/ Edge Panel S 639.00 

Bridge S 218.00 

Lateral File w/ Credenza S 909.00 

Lateral File S 596.00 

Workrite Straightway w/ adjustable Arm S 312.00 

HON Bookcase, 47" h, black S 161 .00 

Eckadams High Back Chair w/ arms, burgundy S 555.00 

HON Guest Arm Chair, Oak/Burgundy S 255.00 

List Price: 



1 S 639.00 

1 S 218.00 

1 S 909.00 

1 S 596.00 

1 S 312.00 

1 S 161.00 

1 S 555.00 

2 S 510.00 
S 3.900.00 



City's Price (40% discount & tax): S 2.538.90 



Large Conference Room 



Chairs 



HON Stackable Guest Chair, burgundy 
(unit=2 chairs) 



Side Chair HON Exexutive Swivel, burgundy 

Electronic Copyboard Plus Corp. 77"x42" 

Table HON Rectangular Table, 42x96, Medium Oak 



S 294.00 
S 500.00 

S 245.00 

S 2,195.00 

S 700.00 



List Price: 



15 S 4.410.00 

8 S 1,960.00 

1 S 2.1 95.00 

1 S 700.00 

S 9.265.00 



City's Price (40% discount & tax): S 6,031 .52 



Small Conference Room 

Electronic Copyboard Plus Corp. 77"x42" 



S 2.195.00 



1 S2.195.00 



69 



875 Stevenson 
Furnishing Cost Estimate 



Item 

Side Chair 
Table 



Item Description 

HON Exexutive Swivel, burgundy 

HON Rectangular Table, 42x96, Medium Oak 



ftLL£UUUeULl 

Page 4 of 4 

Unit Cost Qntv. Cost 

S 245.00 8 $1,960.00 

S 700.00 1 $ 700.00 

List Price: $4,855.00 

City's Price (40% discount & tax): $ 3,1 60.61 



Reception Area 
Side Chair 



Lesro 2-Seat Sofa, Oak/Burgundy 
Lesro End Table, Medium Oak 



$ 472.00 
$ 169.00 



2 S 944.00 
1 $ 169.00 



List Price: 51,113.00 

City's Price (40% discount & tax): $ 603.80 



70 




Attacnmen 
)l) Department of Telecommunications and Information Ser :, ~~- 
WjJ City and County of San Francisco 



December 22, 1998 



& 



THROUGH: Edraundo Colchado, Deputy Director 

Ms. Lena Chen 

Project Manager, 

Utilities Engineering Bureau 

Public Utilities Commission 

1155 Market, Street 

San Francisco, CA 94102 

Dear Ms. Chen: 

The following is an estimate of the total cost to move your operation currently located at 1155 
Market, 7th floor to 875 Stevenson, 3rd floor. A detailed breakdown of the costs associated with 
this move is as follows: 

Lucent equipment costs $37,131.25 

Network Engineering Consulting 4,000.00 

Estimated labor (wiring/install) 30,500.00 

Estimated parts (wiring) 44,500.00 

Pac Bell Tl installation 1 ,590.00 



Total $117,721.25 

DT1S would require a work order in the amount of $1 16,131.25 sixty days prior to your 
anticipated move to fund equipment costs, network engineering consulting charges, and labor 
and parts for wiring. The Pacific Bell installation charge ($1,590) would be covered by the 
Utilities Engineering Bureau's usage work order. 

If you have any questions, please do not hesitate to call me at 550-2777. 



Sincerely, 

iSoto 
Network Engineering Consultant 



cc: J. DeRouen 
M. Hobson 
P. Arnold 



71 



APR-07-1999 16=09 CCSF REAL ESTATE DEPT 

City and County of San Francisco 



W 



Attachment 3 

Real Estate Department 

Office ot the 
Director of Property 



875 Stevenson, 3 rd Floor 

Public Utilities Commission 

Tenant Improvement Budget Summary 

Based On Estimates From Hensel Phelps Construction 

As of 3/24/99 



Doors & Partitions 

Paint & Finishes 

Carpet & Flooring 

Ceilings (Re-work) 

Mill work 

Demolition 

General Conditions 

Mechanical - HVAC 

Fire Protection 

Electrical 

Permits 

Fees 

Indirects (Insurance, Taxes) 

Contingency 

Total 



$ 67,126 
24,817 

127,048 
20,436 
56,275 
48,386 

103,435 
51,500 
15,400 

176,300 

19,880 

77,350 

12,174 

34 , 409 



Excludes Architectural & Engineering, Telephone, Data, Furniiurc and other non construction costs. 



^£^_ fl UREAL_ECT-01SVR\DATA\U^ 875 Stevens Tl.doc 



SanFrandsco, M102 



72 



HrK-v<—lwy e>b:31 



PUC FINANCE 



Post-ir* Fax Note 



7671 



To ^«W t°W-w~ 



Coy0wl U^K 



a*?*.- cml 



E35 [3 



Attachment 4 



Ca 



gra 



liLL 



4*n . sj-TC 



Public Utilities Commission 
Projected Growth (1898-99 to 2000-01) 
11 55 Market Street 



Unit 


New 




Positions 


UEB (contract admin ) 
UEB (construction mgt.) 
UEB (project mgt) 
Hetch Hetchy 
Energy Conservation 
Finance 


3 
10 
23 
8 
5 
4 


Accounting 

Land Management 

Management Information 

Personnel 


3 

1 
3 
3 


Human Rights Commission 


3 



Total 



66 



4/7/999:37 AM 



73 



newpos.xls 
TOTAL P. 01 



Memo to the Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 7 -File 99-0298 



Item: 



Ordinance amending Article VII, Chapter 23, Part I of the 
San Francisco Municipal Code (Administrative Code) 
related to the requirement that employers operating a 
hotel or restaurant in which the City has a proprietary 
interest must use procedures specified in the 
Administrative Code for determining whether an 
employee prefers to be represented by a labor union for 
collective bargaining (Card Check Agreement 
Procedures). The proposed ordinance would amend 
Sections 23.32, 23.33 and 23.34 of the Administrative 
Code to: (1) clarify certain requirements in the Card 
Check Agreement Procedures in Section 23.33; (2) clarify 
the exemptions to the Card Check Agreement Procedures 
and related definitions; and (3) apply the Card Check 
Agreement Procedures to any hotel or restaurant project 
located on property under the jurisdiction of the Airport 
Commission. 



Purpose of Proposed 
Amendments: 



Mr. Jonathan Holtzman of the City Attorney's Office 
states that the purpose of the proposed amendments to 
the Administrative Code is to clarify certain provisions of 
the Card Check Agreement Procedures and to expand the 
scope of the provisions to apply to the Airport. As shown 
in the Attachment, provided by Mr. Holtzman, there are 
four major changes that will be clarified with the 
proposed legislation. In addition, as indicated in the 
Attachment, a further amendment may be introduced at 
the Finance and Labor Committee meeting to clarify a 50- 
employee threshold level for same ownership hotels and 
restaurants at the Airport. 



Description: 



According to Mr. Holtzman, the Card Check Agreement is 
a nonconfrontational alternative process for avoiding 
labor conflicts and union-organized campaigns. Under a 
Card Check Agreement between an employer and a union, 
workers in hotels or restaurants in which the City has a 
proprietary interest must state whether they wish to be 
represented by a union for collective bargaining purposes. 

Presently, while the Card Check Agreement Procedures 
apply to subcontractors, the proposed amendments to the 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



Ik 



Memo to the Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Administrative Code would specify that the Card Check 
Agreement Procedures would apply to any subcontractor 
who operates an applicable hotel or restaurant, or who 
provides a service that is essential to the operation of 
such a hotel or restaurant. 

Currently, developers and managers or operators of 
applicable hotels or restaurants must notify local labor 
councils about the Card Check Agreement pertaining to 
the subject hotel or restaurant project. Under the 
proposed amendments to the Administrative Code, these 
notification requirements would apply only where the 
City's proprietary interest in the hotel or restaurant is 
"based on a lease, a loan, or a guarantee." 

Currently, the provisions of the ordinance applies to 
existing hotel and restaurants only if their contract is 
substantially amended or are renewed or extended with a 
change in ownership greater than 25 percent not within 
the same family. The proposed ordinance defines 
"substantial amendment" for the purpose of determining 
whether an exemption from the Card Check Agreement 
Procedures applies to be any of the following: (1) a 
change in use of the subject premises, (2) a greater than 
25 percent increase in square footage and/or seating or 
rooms with certain exceptions, or (3) an increase in the 
term of the lease. 

The proposed amendments to the Administrative Code 
would clarify that the Card Check Agreement Procedures 
apply only where the City has a proprietary interest in 
the subject hotel or restaurant development (See 
Comment 3). The proposed amendments to the 
Administrative Code would further clarify the definition 
of a proprietary interest, providing that taxes, zoning, and 
the issuances of permits and licenses do not. in and of 
themselves, give rise to a proprietary interest for the City 
in regard to hotel or restaurant projects. 

Finally, under the proposed amendments, the Card Check 
Agreement Procedures would now apply to any hotel or 
restaurant project located on property under the 
jurisdiction of the Airport. The Airport was previously 
exempted from the Card Check Agreement Procedures in 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

75 



Memo to the Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



the Administrative Code, when it was initially enacted in 
June of 1998. 



Comments: 



Recommendation: 



1. According to Mr. Holtzman, the Card Check 
Agreement Procedures are required for those applicable 
hotel or restaurant projects where 50 or more employees 
are employed. By signing an authorized card, an 
employee registers his or her preference on being 
represented by a union for collective bargaining. 

2. Mr. Holtzman states that the proposed amendments 
are intended to protect the City's proprietary interests in 
hotel or restaurant developments, by attempting to limit 
conflicts over the circumstances under which the Card 
Check Agreement Procedures would be required and over 
whom such provisions apply. 

3. According to Mr. Holtzman, and under the existing 
provisions of the ordinance, a "proprietary interest" is 
"any nonregulatory arrangement or circumstance in 
which the financial or other nonregulatory interests of the 
City in a hotel or restaurant project could be adversely 
affected by labor/management conflict or consumer 
boycotts resulting from a union organizing campaign," in 
the following circumstances: (a) when the City receives 
significant, ongoing lease revenue from Citj^-owned 
property that is used for such a project; (b) when such 
revenues are used to pay debt service on bonds or loans 
issued for such a project; (c) when the City has agreed to 
underwrite or guarantee the loans for such a project; or 
(d) when labor conflicts or union-organized campaigns 
could harm the City's financial or other non-regulatory 
interests in such a project. 

Approval of the proposed ordinance is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

76 



H^K-ar'-i^t) ibor ui i t hmt uru AutacnmenL 

City and County of San Francisco Office of the City Attorney 

Louise H. Renne „ ^ ,„«„^«*, 

DikCtDiai: (415)554-4720 

City Attorney e-mail jor>aman_hoitzman@CLjrca.us 

MEMORANDUM 
PRIVILEGED & CONFIDENTIAL 




TO: 


HARVEY ROSE 




Budget Analyst 


FROM: 


JONATHAN V. HOLTZMAN 




Chief Deputy City Attorney 


DATE: 


April 7, 1999 


RE: 


CARD CHECK ORDINANCE 



The Card Check Ordinance has been in effect now for over a year. During that time, a 
few interpretation issues have arisen which would benefit from clarification. 

Some confusion has resulted from the Ordinance's coverage of existing hotel and 
restaurant operations. Generally, the ordinance exempts, or grandfathers, existing hotel and 
restaurant operations. The existing ordinance does, however, apply to existing hotel and 
restaurant operations when their contract or lease with the City is renewed with a "substantial 
amendment." The ordinance presently does not define substantial amendment. 

The amendments clarify that the only circumstance in which the grandfather clause does 
not apply is when a contract or lease is amended, and further, that such amendment must involve 
cither a change in use, an increase in square footage of over 25%, or an extension in term. 

Another issue involves the Ordinance's notification requirements. Concerns have been 
expressed that the Ordinance's requirement to notify the Labor Council of projects that are 
subject to the ordinance could apply to projects which are otherwise exempt from the 
Ordinance's coverage. Although we believe this concern is unfounded, the amendments clarify 
that the notification requirements apply only when the project falls within the coverage of the 
Ordinance. 

Third, the amendments clarify that card check provisions must be included in a 
subcontract only if the subcontract contemplates or permits a subcontractor to operate or manage 
a hotel or restaurant. 

Finally, the amendment deletes an exemption in the original legislation for property 
under the control of the San Francisco Airport Commission. Accordingly, new hotel and 
restaurant projects at the airport will be covered by the ordinance. We are informed that 
Supervisor Katz will offer a further amendment in Committee clarifying that, for new hotels and 
restaurants within the airport, the 50 employee threshold will be calculated by aggregating the 
employees of all hotels or restaurants within the airport under the same ownership. 



Cmr hall, Room 234-1 Dr. Carlton B. Goodiett Place • San Francisco, Caufornia 94 1 02 
Reception: (415J 554-4700 • Facsimile: (415) 554-4715 



TOTAL P. 02 
77 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 8 - File 98-1935 



Note: This item was continued by the Finance and Labor Committee at its 
meeting of February 24, 1999. 



Department: 



Item: 



Description: 



Department of Parking and Traffic (DPT) 
Department of Real Estate (DRE) 

Ordinance to amend Section 17.11 of Chapter 17, Article 
II of Part I of the Administrative Code in regard to 
awarding leases and management agreements for the 
operation of City-owned parking faculties: (1) to eliminate 
the requirement that the Board of Supervisors, by 
ordinance, must first approve the bid documents as well 
as authorize the Director of Property to conduct the 
competitive bidding process; and (2) to eliminate the 
requirement to conduct the formal competitive bidding 
process currently set forth in Section 17.11 under which 
all such agreements must be awarded to the highest 
bidder in the case of a lease or to the lowest bidder in the 
case of a management agreement when the Parking and 
Traffic Commission deems such a formal competitive 
bidding process to be "in the best interest of the public," 
and to replace the established formal competitive bidding 
process with a Bid/Request for Proposals (RFP) process 
developed by the Director of Property and the Department 
of Parking and Traffic (DPT). 

The DPT and the Parking Authority have jurisdiction 
over 18 parking garages and 23 parking lots in the City. 

Changing the Process of Awarding Contracts 

According to Mr. Ronald Szeto of the DPT, the current 
process of awarding leases and management agreements 
to private parking facility operators requires approval of 
two types of legislation by the Board of Supervisors. 
First, the Board of Supervisors must, by ordinance, 
approve bid documents related to the award of such 
contracts as well as authorize the Director of Property to 
issue an Invitation for Bid. Second, the Board of 
Supervisors must, by resolution, approve the contract 
awarded to the highest bidder in the case of a lease or the 
lowest bidder in the case of a management agreement. 

Board of Supervisors 
Budget Analyst 



78 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



According to Mr. Szeto, this two-part process for obtaining 
approval of an award by the Board of Supervisors 
generally takes six months. 

Mr. Szeto states that the proposed ordinance would 
expedite this process by two months, by removing the first 
requirement that the Board of Supervisors must approve 
the bid documents to be used for issuing Invitations for 
Bids and must authorize the issuance of the Invitation for 
Bids. Currently, the Board of Supervisors may revise the 
bid documents submitted by the DPT prior to approving 
or rejecting them by ordinance. According to Mr. Szeto, 
under the proposed amendments, the DPT would continue 
to use such bid documents that have been approved by the 
Board of Supervisors in the past, but that modifications to 
the bid documents, after review and approval by a Deputy 
City Attorney, would be able to be made by the DPT 
without obtaining approval from the Board of 
Supervisors. 

The actual award of each lease or management agreement 
to designated parking operator firms for the operation of 
City-owned parking facilities would continue to be subject 
to approval by the Board of Supervisors. 

Changing Competitive Bidding Requirements 

The competitive bidding process currently described in 
Section 17.11 permits the award for leases and 
management agreements to the highest responsive and 
responsible bidder in the case of leases or the lowest 
responsive and responsible bidder in the case of a 
management agreement. 

Under the proposed ordinance, the formal competitive 
bidding procedures described in Section 17.11 of the 
Administrative Code would not be utilized if the Parking 
and Traffic Commission determined that such "a 
competitive process" would not be in the best interests of 
the public. According to the proposed ordinance, in such 
circumstances awards could be made through a 
"competitive process developed and implemented by the 
Director of Property and the Executive Director of the 



Board of Supervisors 
Budget Analyst 

79 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Department of Parking and Traffic" through the 
utilization of a Bid/Request for Proposals (RFP) process. 

Approval of the proposed amendment would enable the 
DPT to issue Bid/RFPs, in lieu of the formal competitive 
bidding process that is currently prescribed in Section 
17.11 of the Administrative Code, for awarding leases and 
management agreements for parking facility operations. 
Mr. Szeto confirms that this legislation would enable the 
DPT to award such parking leases and management 
agreements on a sole-source basis, subject to approval by 
the Board of Supervisors. 

At the request of the Budget Analyst, Attachment I 
provided by Mr. Szeto and Mr. Gerald Romani of the 
Department of Real Estate (DRE), describes four prior 
specific instances which they believe clearly demonstrate 
that the formal competitive bidding process was 
impractical or impossible. However, in each of those 
instances, the lease or management agreement was, in 
fact, awarded through a formal competitive bidding 
process. 

Attachment II provided by Mr. Szeto describes each of the 
specific criteria, in addition to monetary considerations, 
that the DPT would use to evaluate potential operators if 
the DPT were able to issue Bid/RFPs, in lieu of using the 
currently required formal competitive bidding procedures 
to award leases and management agreements to operate 
the parking facilities under the jurisdiction of the DPT 
and the Parking Authority. Under the proposed Bid/RFP 
evaluation process, DPT would weight the cost of the 
parking operator's bid at 150 or 60 percent of the 250 total 
points being considered. 

Comments: 1. As previously noted, according to Mr. Szeto, the 

current process of awarding leases and management 
agreements generally takes six months. Mr. Szeto 
estimates that by eliminating the requirement that the 
Board of Supervisors must approve the bid documents 
prior to authorization to begin the competitive bid 
process, the entire process can be reduced by two months 
under the proposed ordinance. 



Board of Supervisors 
Budget Analyst 

80 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



2. According to Mr. Romani, the current bidding process 
requires that awards be made solely based on the amount 
of the bids presented by operators, after specific 
qualifications established by the DPT are met. However, 
Mr. Szeto states that through the use of a Bid/RFP 
process, the DPT would receive additional information 
from potential operators as to the quality of service and 
the management proposed to be provided. The Budget 
Analyst notes that nothing whatsoever precludes the DPT 
from obtaining such additional information under the 
presently required formal competitive bidding procedures, 
which, under the current provisions of Administrative 
Code Section 17.11, require the award of such contracts to 
"responsive and responsible" bidders. 

Also, with regard to the examples of problems related to 
the use of competitive bids cited by DPT in Attachment I, 
the Budget Analyst believes that any such problems could 
have been resolved through the preparation of detailed 
bid specifications and contract performance standards. 



Recommendations: 1. We consider the elimination of the requirement that the 
Board of Supervisors approve of bid documents related to 
the award of agreements to parking operator firms of City- 
owned parking facilities to be a policy matter for the Board 
of Supervisors. 

2. However, the Budget Analyst has not been presented 
with compelling evidence to show that it would be more 
beneficial financially for the City to permit the DPT to 
waive the formal competitive bidding process established in 
Section 17.11 of the Administrative Code, particularly 
when any additional information which the DPT states it 
would obtain using a Bid/RFP process could, in fact, also be 
obtained under a formal competitive bidding process. 



Board of Supervisors 
Budget Analyst 

81 



ATTACffMFT 

Paee 1 of 2 



1 . Performing Am Garage Bid dates-8/23/96 and 12/4/96 

Initially a bid opening was held on 8/23/96 for sward of a management agreement with a 
fee based upon a percentage of the gross parking revenues less the parking taxes. Whh 
the numerous, significant renovation/construction projects either underway or proposed 
to begin in the Civic Center area (City Kail, Courts Building, Opera House, State 
building and Asian Art Museum), the relocation of employees and patrons of the arts 
would reduce the garage revenues. In addition, a City-vehicle motor pool was proposed 
for the garage which could impact up to 81 of the 612 spaces. As a result, bids ranging 
from 3.45% to 64.5%, which could not begin to cover the operating expenses, were 
received with the then current operator bidding the highest Since the three low bids 
ranged from 3.45% to 15.9% and such a wide range in bids existed, the Parking Authority 
Commission followed the staff recommendation by rejecting all bids. This required a 
rebid which took place on 12/4/96. Due to these various factors an RFP vs. a competitive 
bid would have been beneficial and prevented duplication of staff efforts in the rebid. 

2. San Francisco General Hospital Medica l Center Parking System Bid dates-3/12/96 
and 5/27/98 

With the completion of the new parking garage at SrGH approaching, a management 
agreement to operate the parking system (the "System"), consisting of 1701 System 
parking spaces (807-garage, 658-campus and 236-street), was developed. Because of the 
complexity of the System with hs size, 24-hour operation, different type of parking 
categories, a required lottery to select the monthly parkers and sophisticated parking 
control/revenue equipment to develop revenue reports, parking utilization plans, etc., an 
RFP process would have provided the ability to exam a parking firm's experience and 
expertise to operate such a large, complex facility. Recognizing these problems and 
having to award the contract to the lowest bidder, the initial term of the contract was 
limited to 2 years. Upon expiration of the initial contract a new operator took over who 
was also awarded the contract through a competitive bid process. 

3- St Marv's Square Garage Bid datc-2/6/97 

This 6-story, 825-space garage required extensive renovation including seismic retrofit 
resulting from damage sustained during the Loma Prieta earthquake. A $6M+ renovation 
project, which commenced in late July 1998, is near completion. Valet parking of 
vehicles is required during the majority of the garage's hours and resulted in gross 
revenues less parking taxes of 53 JM for the 1996-97 fiscal year. During the renovation 
project up to 50% of the garage area may be closed. Due to the high volume of vehicles 
parked and the impact the renovation project would impose on the parking operation, an 
RFP process would allowed fer better assessment of a parking operator's ability to 



82 



ATTACHMENT I 
Page 2 of 2 

successfully operate this garage, especially during the trying times of the renovation 
project. 

4. Civic Center Plaza Ga rage Bid date-4/27/98 

The most recent bid for management of this garage illustrates problems that can be 
encountered in utilizing a competitive bid proceai instead of an RFP. Seven bids with 
monthly management fees ranging from 528,333 to SS7.782 were received. Staff 
believed a management fee of 545K/mc. to be a realistic management fee to operate the 
garage at the minimum levels contained in the management agreement. A 
recommendation by staff to reject all bids was approved by bath the Parking and Traffic 
Commission and the Board of Supervisors. The contract was extended with tbe current 
operator on a month to month basis through 12/3 1/99 to allow for time to evaluate the 
possible impacts on the garage that may result from a proposed Civic Center Plaza 
Historic District bond measure. 



rLftracnani/Aaachmcatl 

83 



HI-'K-tS r-1^^3 J.O-->-> 



ATTACHMENT VII 



EVALUATION and SELECTION CRITERIA 



Management Approach 

a) Understanding of the garage attributes and limitations 
as well as the needs of the clientele in order to develop 
a garage utilization plan to provide sound and efficient 
management 



25 points 



25 points 



Assigned Management Staff 

a) Professional qualifications and experience 

of manage- and on-site supervisors; availability 
of extra staff for additional services on an "as 
needed" basis 

b) Recent experience of staff to be assigned to 
the garage and a description of the duties to 
be performed by each staff person 

Experience of Firm and Sub-consultants 

a) Expertise of the firm and sub-consultants 
in the fields necessary to complete required 
tasks such as parking management, maintenance/ 
repair, janitorial services and security services 

b) Overall management quality of recently operated 
parking facilities, including adherence to deposits, 
reports and budgets 



30 points 



20 points 



10 points 



20 points 



15 points 



45 points 



c) Experience with similar parking facilities 



10 points 



4. Management Fee Bid 

a) Management fee 

HRC Ratines Discount 



150 points 



150 points 



Total: 250 points 



Completion and submission of required forms by HRC certified LBE's.MBE's and WBE's could 
earn certified firms up to an additional 25 points for a possible maximum of 275 points 
(250 pts. + 25 pts.«= 275 pts.). 



HAJRcxnoni\EAScriteriA2.doc 



84 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 9 - File 99-0377 



Department: 



Item: 



District Attorney (DA) 
Family Support Bureau 

Supplemental appropriation ordinance in the amount of 
8600,000 in Federal and State funds for the adaptation 
and installation of San Francisco's Computer Assisted 
Support Enhancement System (CASES), a computerized 
Child Support Enforcement System, in 24 California 
counties. 



Amount and 
Source of Funds: 



Federal Public Assistance Administration 

Funds 
State Public Assistance Funds 

Total 



$396,000 
204.000 
600,000 



Description: 



The proposed supplemental appropriation ordinance 
would appropriate Federal and State funds in the amount 
of $600,000 to the District Attorney's (DA) Family 
Support Bureau to support the adaptation and 
installation of San Francisco's Computer Assisted Support 
Enhancement System (CASES) in 24 California counties. 

In 1987, the DA's Family Support Bureau developed and 
implemented CASES, an automated system used by the 
Family Support Bureau to locate absent parents, 
establish paternity, establish and enforce child support 
court orders, collect and distribute child support proceeds, 
and periodically review child support cases. 

In 1989, the Federal government mandated that all 
States establish automated child support systems that 
could be linked between States and the counties within 
each State. The State of California retained a contractor, 
Lockheed Martin, to develop the Statewide Automated 
Child Support System (SACSS) in order to meet this 
Federal mandate. The Statewide system (SACSS) was to 
have replaced San Francisco's local system (CASES). 
However, according to Mr. Merlin Zimmerly of the DA's 
Family Support Bureau, when the State installed SACSS 
in San Francisco in 1996, the Family Support Bureau 
found that, unlike CASES, SACSS could not perform 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



85 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



some of the basic functions of establishing child support. 
As a result, after six months of using SACSS, the Family 
Support Bureau returned to using CASES. Subsequently, 
according to Mr. Zimmerly, after the State expended $99 
million on SACSS, the State determined in 1997 that 
SACSS would not work and rejected the whole system. In 
order to meet the Federal government's deadline of 
October 1, 1998 for nationwide implementation of 
automated child support systems, the State Legislature 
decided to allow counties to adopt existing local systems, 
such as San Francisco's CASES, which could then be 
networked between counties. 

Mr. Zimmerly advises that San Francisco's CASES, one of 
four systems accepted by the State for implementation in 
other California counties, has been adopted by 23 other 
counties because CASES is easy to use, is user-friendly, 
meets all operational requirements and can be networked. 
These 23 other counties and the San Francisco DA's 
Family Support Bureau have entered into a 
Memorandum of Understanding (MOU) which names San 
Francisco as the fiscal agent for the CASES consortium 
and authorizes San Francisco to direct the adaptation 
and/or installation of CASES in all 24 counties. 

The Family Support Bureau's FY 1998-99 budget includes 
$2,100,000 in funding, including Federal funds of 
$1,334,520, State funds of $421,740, and local matching 
funds of $343,740 for the adaptation and/or 
implementation of CASES in the 24 consortium member 
counties. San Francisco's share of the $343,740 local 
match is $40,661, to be paid with Federal funds. Of the 
23 other member counties, 20 counties will reimburse San 
Francisco for the remaining $303,079 of the local match 
during FY 1998-99. Mr. Zimmerly advises that the three 
other member counties will contribute to the $2.1 million 
contract with Informatix at a future date, and that each 
county's portion of the $343,740 local match will then be 
readjusted. Attachment I. provided by the Family 
Support Bureau, shows (a) the 24 member counties and 
(b) the 21 contributing member counties' portions 
(including San Francisco) of the $343,740 local match. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

86 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

In 1998, the Family Support Bureau awarded a sole 
source contract to Informatix, Inc. in the amount of 
$2,100,000 for the basic adaptation and implementation 
of CASES in 24 counties' Family Support Divisions 
(including San Francisco). Attachment II, provided by the 
Family Support Bureau, contains the basis for the 
$2,100,000 contract amount to be paid to Informatix. Mr. 
Zimmerly advises that the Family Support Bureau 
contracted with Informatix on a sole source basis because 
Informatix had provided system support of San 
Francisco's CASES for the previous five years and 
therefore already had significant expertise in working 
with CASES. 

The proposed supplemental appropriation ordinance 
would appropriate an additional $600,000 in Federal and 
State funds in order for Informatix to complete additional 
work related to the implementation of CASES in the 24 
consortium member counties, resulting in a total payment 
to Informatix by the City of $2,700,000. This additional 
$600,000 would be used by Informatix to install interfaces 
between CASES and 12 member counties' automated 
financial systems and 13 member counties' automated 
welfare systems. This $600,000 is based on the State's 
estimated cost of $24,000 per interface application for 25 
applications. Mr. Zimmerly advises that not all 24 
counties require the installation of such interfaces 
because many counties have automated welfare and/or 
financial systems that are already compatible with 
CASES. Mr. Zimmerly further advises that, although it 
was anticipated that this additional work would be 
required of Informatix when the Family Support Bureau 
submitted its FY 1998-99 budget request, the cost of and 
funding source for this additional work was not known at 
that time. 

Comments: 1. As noted above, the Federal government's deadline for 

nationwide implementation of automated child support 
systems was October 1, 1998. According to Mr. Zimmerly, 
because the State of California failed to meet this 
deadline, it will be assessed financial penalties by the 
Federal government in the amount of $89,900,000 in FY 
1999-2000. Mr. Zimmerly advises that, according to the 
State Legislative Analyst's Office, the State currently 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

87 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

plans to pass these financial penalties on to the counties. 
According to Mr. Zimmerly, if this occurs, San Francisco's 
share is estimated to be $2,801,248. Mr. Zimmerly 
advises that a funding source for this amount has not 
been identified and that such funds have not been 
requested in the District Attorney's FY 1999-2000 budget. 

2. Given that (a) the $89,900,000 Federal penalty is 
being assessed against the State because of the State's , 
and not the counties', failure to implement an automated 
child support system, and (b) the San Francisco DA's 
Office has been operating an automated child support 
system (CASES) since even before such a system was 
mandated by Federal law, the Budget Analyst questions 
the validity of the State's passing on such a Federal 
penalty to San Francisco. As such, the Finance and Labor 
Committee should request that the City Attorney prepare 
a resolution for consideration by the Board of Supervisors 
urging the State Legislature not to assess a penalty 
against San Francisco. Mr. Ed Harrington of the 
Controller's Office concurs with this suggestion of the 
Budget Analyst. 

Recommendations: 1. Approve the proposed supplemental appropriation 
ordinance. 

2. Request that the City Attorney prepare a resolution for 
subsequent consideration by the Board of Supervisors, 
urging the State Legislature not to assess a Federal 
penalty against San Francisco with regard to the 
Federally mandated computerized Child Support 
Enforcement System, in accordance with Comment No. 2 
above. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

88 



Apr--01-93 09:45A SFDA Family Support 



Attachment I 



CASES Consortium Costs 










Estimated Proration to Member Counties 










Fiscal Year 1998-99 










Open 


Production 


Release 


Operations 




Cases 


Deliverables 
1,912,000 


Deliverables 
110,000 


Support 

78,000 


Total 


Gross CASES Consortium Costs 


2,100,000 


Less 66 % Federal Share: 


1,261,920 


72.600 





1 ,334,520 


Less 17% State Share: 


325,040 


18,700 





343.740 


Less 1 00 % State Share: 








78,000 


78,000 



Net Costs to be Paid by 
Member Counties 

Member County Shares 
Based on Open Caseload 

Alpine 166 

Amador 3,639 

Colusa 2,031 

DelNorte 4,069 

Inyo 1,866 

Kings 9,710 

Lake 5,959 

Mariposa 960 

Modoc 1,049 

Mono 622 

Plumas 1,560 

San Francisco 30,972 

San Luis Obispo 8,096 

Santa Clara 74,869 

Sierra 181 

Siskiyou 5,065 

Solano 25,977 

Sonoma 20,191 

Sutter 7,245 

Trinity 1 ,097 

Tulare 42249 

Total Member Shares 247,593 

Non Participating Members 

Contra Costa 
Santa Cruz 
Tuolumne 



325,040 



218 

4.777 

2.666 

5,368 

2.450 

12,747 

7.823 

1260 

1.377 

817 

2,048 

40,661 

10,628 

98288 

238 

6,649 

34.103 

26.507 

9.511 

1.440 

55,464 

325,040 



18,700 









3,740 








3.740 



3,740 

3,740 



3,740 

18,700 



343,740 






218 





4,777 





2,666 





5,368 





2,450 





16,487 





7,823 





1,260 





1,377 





817 





2,048 





40,661 





10,628 





102,028 





238 





6,649 





37,843 





30,247 





9,511 





1.440 





59204 



343,740 



89 



Apr-Ol-99 09:45A SFDA Family Support 



Attachment II 
Page 1 of 3 



CASES Consortium Budget Estimate 
Fiscal Year 1998-99 





No. of 


Professional 


Hourly 




Position Title 


Positions 


Hours 


Rate 


Cost 


Project Manager 


1 


2.000 


$150 


$300,000 


Data Base Administrator 


1 


2,000 


$125 


250,000 


Quality Assurance Analyst 


1 


2.000 


$125 


250,000 


Senior Programmer Analyst 


2 


2,000 


$125 


500,000 


Programmer Analyst 


4 


2,000 


$100 


800,000 


Total 


9 


10,000 


$2,100,000 



90 



Apt — 01-99 09:45A SFDA Family Support 



Attachment II 
Page 2 of 3 



CASES Consortium Professional Service Contract Summary 
Informatix, Inc. 
Fiscal Year 1998-99 



Task 



Deliverable 



Production Deliverables 

(Fixed price paid upon completion of Deliverable) 



Design PRWORA 
Distribution Basis 



Technical Design Document 



Costs 



320,850 



Develop and Implement 
PRWORA Distribution 

Design PRWORA 
Reporting Basis 

Develop and Implement 
PRWORA Reporting 

Design Year 2000 Plan 
for CASES System Basis 

Year 2000 Modifications 

Federal Level I Requirements 
Design Document Basis 

Federal Level I Required 
Enhancements 

Efficiency or Other Mandated 
Enhancements Design 
Document Basis 



Product in Production 


392,150 


Technical Design Document 


145,350 


Product in Production 


177,650 


Technical Design Document 


32,625 


Product in Production 


39,875 


Technical Design Document 


244,350 


Product in Production 


298,650 


Technical Design Document 


117,225 



Efficiency or Other Mandated 
Enhancements 

Subtotal - Production Deliverables 



Product in Production 



143,275 



1,912,000 



91 



Apr-Ol-99 09:45A SFDA Family Support 



Attachment II 
Page 3 of 3 



Task 



Deliverable 



Costs 



Release Deliverables 

(Fixed price paid upon completion of Deliverable) 



Prepare PRWORA Distnbution 
Release to Non-HWDC Counties 

PRWORA Distribution 
Documentation 

Prepare PRWORA Reporting 
Release to Non-HWDC Counties 

PRWORA Reporting 
Documentation 

Prepare Year 2000 Release 
to Non-HWDC Counties 

Year 2000 Documentation 

Prepare Federal Level I Release 
to Non-HWDC Counties 

Federal Level I 
Documentation 

Efficiency or Other Mandated 
Enhancements Documentation 

Prepare Efficiency or Other Mandated 
Enhancements Release 
to Non-HWDC Counties 

Subtotal - Release Deliverables 



Deliver/ of Release 
Document and Tapes 

Operational Documentation 



Delivery of Release 
Document and Tapes 

Operational Documentation 



Delivery of Release 
Document and Tapes 

Operational Documentation 

Delivery of Release 
Document and Tapes 

Operational Documentation 



Delivery of Release 
Document and Tapes 

Operational Documentation 



10,000 



12,000 

10,000 

12,000 

10,000 

12,000 
10,000 

12,000 

10,000 

12.000 



110,000 



CASES System Operations Support of 
Counties Using HWDC 

($13,000 monthly for six months from Jan. thru June, 1999) 

Total CASES Consortium Contractual Services 



78,000 



2,100,000 



92 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 10-99-0582 

Note: This report is based on an Amendment of the Whole submitted to the 
Finance and Labor Committee by the Department of Human Services on April 7, 
1999. 



Department: 
Item: 



Department of Human Services (DHS) 

Resolution urging the Department of Human Services to 
enter into a contract with the Tenderloin Housing Clinic 
in order to secure low-income housing units at the Seneca 
Hotel for the County Adult Assistance Program clients 
and other low-income persons, and urging the Tenderloin 
Housing Clinic to enter into a master lease with the 
owners of the Seneca Hotel. 



Contract Amount: 



Source of Funds: 



Contract Period: 
Description: 



$160,563 for FY 1998-99 funding from May 1, 1999 
through June 30, 1999. $599,642 for full year funding in 
the proposed FY 1999-2000 DHS budget. 

For FY' 1998-99 costs of $160,563, DHS would fund the 
contract from appropriated, but unspent General Fund 
dollars. For FY 1999-2000 costs of $599,642, DHS would 
fund the contract from General Fund dollars requested by 
DHS in its FY 1999-2000 DHS budget. 

May 1, 1999 through April 30, 2009 (ten years) 

The proposed resolution would urge DHS to enter into a 
contract with the Tenderloin Housing Clinic (THC), which 
is a nonprofit organization that provides rental assistance 
to homeless persons whose lack of stable housing is a 
barrier to securing emploj'ment, in order for DHS to 
secure up to 204 low-income housing units for County 
Adult Assistance Programs (CAAP) and low-income 
clients of DHS, including clients enrolled in the Personal 
Assisted Employment Services (PAES) program. 

On October 26, 1998, DHS implemented PAES as one of 
four programs under CAAP. PAES is a program that 
assists indigent adults in finding employment and staying 
emplo\ r ed. Under the PAES program, clients who are 
employable and who have successfully completed three 
months of workfare activities, which include assessment 
of employability, are referred to PAES for extensive case 
management, employment assistance and support 
services in order to assist them in becoming economically 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



93 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



self-sufficient. Mr. Dariush Kayhan of DHS reports that 
there are currently approximately 5,100 PAES clients. As 
of March 31, 1999, approximately 2,000 General 
Assistance (GA) clients still need to be transitioned into 
one of the CAAPs. According to Mr. Kayhan, DHS 
anticipates that all GA clients will be enrolled in a CAAP 
by June 1, 1999. 

At the beginning of FY 1998-99, DHS implemented a 
Rental Subsidy Program for PAES program participants. 
DHS contracts with THC to perform the property 
management and administrative functions of the 
program. THC is a nonprofit organization that assists 
County Adult Assistance Programs (CAAP), 
Supplemental Security Income (SSI), and other low- 
income individuals in obtaining permanent and affordable 
housing by negotiating the rent and terms of the lease 
with potential landlords. 

According to Mr. Kayhan, DHS implemented the Rental 
Subsidy Program because over 1,100 residential rental 
units have been taken off of the market since 1990. In 
addition to the tight housing market in San Francisco, 
Mr. Kayhan explains that 643 units located in residential 
hotels, which have historically been rented to low-income 
tenants, have been destroyed by fire in the past 18 
months, exacerbating the difficulty of securing low-income 
units in the private market. Attachment I provided by 
DHS lists the names and locations of these hotels which 
have been destroyed by fire. 

Attachment II is a memorandum submitted by Ms. Julie 
Brenman of DHS describing how the program works, the 
funding for the program, including how the subsidy is 
calculated, the purpose of the resolution, and identifies 
the specific types of DHS program clients who would be 
eligible to participate in the Rental Subsidy Program at 
the Seneca Hotel. The PAES Rental Subsidy Program 
provides a rental subsidy for up to a maximum of $150 
per month, on a cases by case basis, for up to 12 months. 
According to Ms. Brenman, the rental subsidy may be 
extended for an additional 15 months for a total of 27 
months if the client is making progress in his or her 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

94 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



employment plan, but has not been able to secure enough 
income for rent. 

According to Ms. Brenman, the costs for operating the 
Rental Subsidy Program at the Seneca Hotel would be 
$258,483 paid to THC for the two month period from May 
1, 1999 through June 30, 1999 for the anticipated 
utilization of 122 rooms at an average room rent paid by 
tenants of $400 per month, as described below: 



Category 


Amount 


Salaries and Benefits 


$56,811 


Operating Expenses (including rental 




payment of $110,002) 


171,972 


Capital Expenses 


29.700 


Total Costs 


$258,483 



The total cost to DHS for operating the program at the 
Seneca Hotel from May 1, 1999 through June 30, 1999 
would be $160,563, or $258,483 less $97,920 from 
anticipated tenant rental income paid by the program 
participants to THC. According to Ms. Brenman, staff 
would be hired in April in anticipation of the program 
becoming operational on May 1, 1999. Ms. Brenman 
states that the department plans on funding these costs 
with savings achieved due to the underutilization of the 
program, as explained in Attachment II. Attachment III 
provided by DHS contains additional budget details for 
this subject request for FY 1998-99 of $160,563 including 
salaries/benefits costs, operating expenses, and capital 
expenses. The total estimated annual costs of this Seneca 
Hotel Master Lease Program for PAES clients is 
$1,480,922, $599,642 to be paid by the City's General 
Fund from the proposed FY 1999-2000 DHS budget and 
$881,280 to be paid by program participants for tenant 
rents. The FY 1999-2000 payment of the $599,642 City 
General Fund contribution will be conditioned on the 
approval of the DHS proposed FY 1999-2000 budget by 
the Mayor and the Board of Supervisors. 

The total estimated costs to operate the PAES Rental 
Subsidy Program at the Seneca Hotel for FY 1999-2000 of 
$1,480,922 are as follows: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

95 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Category Amount 

Salaries and Benefits $335,988 
Operating Expenses (including rental 

payments by program participants 

of$660,012) 1.130,434 

Capital Expenses 14,500 

Total Costs $1,480,922 

Attachment IV provided by DHS contains additional 
budget details to support the projected expenditures of 
$1,480,922 for FY 1999-2000, including the salary /benefit, 
operating, and capital expenses. The proposed cost to 
DHS of $599,642 would be from the proposed FY 1999- 
2000 DHS General Fund Budget and paid directly to 
THC. The proposed DHS contribution of $599,642 plus 
anticipated tenant rental income of $881,280 would meet 
the proposed annual operating budget of $1,480,922. 
While the Rental Subsidy Program is designed to serve up 
to 270 PAES participants per year, only 40 PAES 
participants are currently enrolled because of the low 
vacancy rates of low-income housing, according to Ms. 
Brenman. Ms. Brenman explains that this lack of low- 
income housing is DHS's reason for seeking this 
opportunity to secure additional low-income housing for 
its clients by paying $599,642 of FY' 1999-2000 General 
Fund dollars to THC. The 40 PAES clients are living in 
three residential hotels with whom DHS has been 
working since the inception of the Rental Subsidy 
Program. These three hotels are listed below: 

Average Monthly 
Name Location Room Rent # of Clients 

Windsor Hotel 238 Eddy St. $400 23 

Pacific Bay Inn 520 Jones St. $400 _4 

Seneca Hotel 34 Sixth St. J400 13 

According to Mr. Kayhan. DHS anticipates that all 204 
units in the Seneca Hotel would become available for 
PAES participants as a result of this proposed agreement. 
The exact date upon which all of the units would become 
available is not known, according to Mr. Kayhan, because 
it is unknown when all of the existing tenants would move 
out of the facility. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

96 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Comments: 



The proposed resolution also urges THC to enter into a 
ten-year lease with the Seneca Hotel, in order for DHS to 
secure the housing units for its PAES clients on a long 
term basis. The annual rental cost for this ten-year lease 
is $660,012, paid for by THC from tenant rental income 
estimated to be $881,280 for FY 1999-2000 to the Seneca 
Hotel. THC would form City Housing, Inc., a separate 
nonprofit organization, to lease and manage the 
residential housing. 

1. In page four of Attachment II, Ms. Brenman explains 
that the projected tenant rental income for FY 1998-99 
was calculated by presuming 60 percent occupancy of 204 
units for two months multiplied by the average $400 
monthly rent. The projected tenant rental income for FY 
1999-2000 was calculated by presuming 90 percent 
occupancy of 204 units for 12 months multiplied by the 
average $400 monthly rent. The average $400 monthly 
rent reflects the rent for all Seneca Hotel tenants, not just 
those in the Rental Subsidy Program. Ms. Brennan 
reports that DHS allocated $240,000 for the rental 
subsidy payments for FY 1998-99 and $305,000 for the 
subsidies for FY 1999-2000. 



Recommendation: 



2. The Seneca Hotel is owned by 32-40 Sixth Street LLC, 
and was selected, as explained in Attachment II, because 
of its positive working relationship with THC. 

Approval of the proposed resolution is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

97 



Memo to Finance and Labor Committee 

April 14, 1999 Finance and Labor Committee Meeting 





rvey M. Rose 



cc: Supervisor Yee 
Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

98 



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6S:S0 666T-90-ycW 



Page 1 of A 

City and County of San Francisco Department of Human Services 




WW Ughtoo jmi 
fcjtecufrv* DirvctD 

LHrftuty Dtrmctns* 

RJi' B*o*ncoun 
Jim Bluch 
Sally KJppar 



MEMORANDUM 

April 8, 1999 

TO: Shiriy Lee, Budget Analyst 

FROM: Julie BrenmaiCDirector of Planning and Budget 

RE: Seneca Hotel Master Lease 



The Department of Human Services plans to enter into a contract with the Tenderloin 
Housing Clinic (THC), who, in turn will enter into a master lease agreement to take over 
the operations of the Seneca Hotel effective May 1, 1999. DHS will use savings in the 
FY 1998-99 budget to fund the operating costs in the current fiscal year. By master 
leasing the Seneca Hotel we will secure up to 204 units for PAES (Personal Assisted 
Employment Services) clients who are currently homeless and ensure long-term housing 
affordability for the PAES clients. 



Background 

In October 1998, DHS implemented a rental subsidy program for PAES program 
participants for whom homelessness was a barrier to securing employment This program 
was developed to address the rental market changes in San Francisco whereby housing 
that was available to low-income tenants has become extremely difficult to find. Since 
1990 over 1000 residential units have been taken off of the market In addition to the 
tight housing market many of the residential hotels that traditionally rented to these 
tenants have been destroyed by fire. In the past year and a half alone, 643 of these units 
have been lost to fires. In response to the difficulty of securing units in the private market, 
DHS is proposing a new master leasing program to be conducted in partnership with the 
Tenderloin Housing Clinic. 



PAES Rental Subsidy Program 

The PAES Rental Subsidy Program, operated by the Tenderloin Housing Clinic as a 
contractor with DHS, provides a time-limited rental subsidy to PAES Program participants 
for whom lack of stable housing is a barrier to employment A PAES client is eligible for 
the subsidy once s/he has created an employment plan and deemed to be lacking stable 
housing. The subsidy is initially limited to 12 months, with a possibility of extensions up 



(415) 557.5000 P.O. Box 7988 San Frmncisco, California 94120 



100 



Fage^ or 4 

Seneca Master Lease 

April 8, 1999 

Page 2 

to a maximum of 27 months. (The subsidy can be extended when a PAES client is 
positively progressing in his/her employment plan, but has been unable to secure enough 
income to pay for the rent on his/her own.) The subsidy is calculated based on the 
difference between the $300 per month tenants are required to contribute (from their S3 5 5 
PAES grant) and the actual housing unit rent up to $ 1 00 per month. Because of the 
increasingly expensive rental market, DHS authorized THC to begin providing subsidies 
up to a maximum of S 1 50 per month, on a case by case basis. The program is designed to 
serve up to 270 people per year, but currently only 40 people are enrolled because of the 
overall increase in rents for existing units caused by high demand and low vacancy rates. 



Description of Program and Building 

The Seneca Master Lease program will allow THC to enter into a ten year lease with the 
Seneca Hotel, a 204 unit residential building located on Sixth Street in San Francisco. 
The building is partially occupied by permanent tenants (about 130), many of whom (89) 
are participants in THC's Modified Payment Program (MPP). The PAES subsidy 
program would initially secure 84 units that are currently licensed for tourist use. As a 
condition of the DHS contract with THC, all future vacancies at the Seneca would be 
made available to participants of the PAES rental subsidy program, (a subset of the 
participants of the MPP program) that are referred to THC by the PAES Employment 
Specialists. 1 Rents and subsides would be administered by THC as is the current practice 
of MPP. Pending the DHS Co mmis sion and Board of Supervisors approval, the program 
could begin crperating the Seneca hotel on May 1, 1999. 

This program will benefit DHS and its clients by securing more low-income housing and 
keeping it affordable for persons participating in welfare to work activities. The 
Tenderloin Housing Clinic will also be able to make more referrals and increase the 
number of clients served by the PAES rental subsidy program. This will create a better 
environment for the clients by increasing the support services available there, as well as 
increasing the staff on site so it will be a safer, better maintained building. 

Because the PAES rental subsidy program has been underutilized, DHS and THC jointly 
sought ways to increase its effectiveness. The primary difficulty had been in securing 
affordable units for the PAES rental subsidy clients. As a modification to the existing 
contract with THC, DHS has encouraged THC to identify ways to gain access to more 
units of affordable housing. THC identified the Seneca Hotel as an appropriate site and 
the owners 2 demonstrated a willingness to lease their hotel to THC. The owners took over 



1 The contract with THC is currently being negotiated. DHS will propose the following language be 
included: "THC will lease the Seneca Hotel for the purpose of placing PAES subsidy clients in permanent 
housing. All new clients placed in the Seneca Hotel will be referred by DHS Employment Specialists to 
THC for the PAES rental subsidy program. All new cbents placed at the Seneca Hotel will be enrolled in 
THC's Modified Payment Program and the PAES rental subsidy program. All clients living in the Seneca 
Hotel will be eligible to participate in support services offered through THC." 

2 The Seneca is owned by 32-40 Sixth Street LLC. 



101 



Page 3 of U 

Seneca Master Lease 

April 8, 1999 

Page 3 

the building a few years ago and have an established relationship with THC. They have 
indicated they will only work with THC based on their established relationship. The 
owners will benefit by getting out of the property management business and receiving a 
stable source of income on their building. It is likely that this program will make the 
hotel a more attractive piece of property. 



Funding 

DHS will fund the Seneca master lease program in the current fiscal year with savings 
achieved due to the underutilizauon of the PAES rental subsidy program- The DHS 
funded operating costs for April - June 1 999 will be S160.563 (staff will be hired in April 
in anticipation of the program becoming operational on May 1, 1999). Because of the 
underutilization of the PAES rental subsidy program, we are able to redirect savings in 
that contract to this new proposal to master lease the Seneca HoteL The original 1 0- 
month budget for the PAES rental subsidy program was $328,333. Of the 5328,333, 
5240,000 was dedicated to rental subsidy payments and the balance was for 
stafDoperating costs. As of March, only $4,000 in rental subsidy payments had been 
made. In addition, one of the two staff persons was not hired until April, so there were 
additional savings in the staffbudget. We arc proposing to redirect SI 60,563 to the 
Seneca Master Lease. 

DHS will pay THC for the operating costs of the Seneca (and will continue to pay THC 
for the costs of running the PAES rental subsidy program). THC will take over the 
operation of the entire 204 unit hotel on May 1, 1999 even though some of the rooms are 
already occupied by other low-income tenants. The project budget pays for the lease of 
the hotel, a property management specialist, a hotel manager, and desk and maintenance 
staff The annual cost of the lease is 5660,012 (or 56,600,120 over the ten-year master 
lease period). DHS anticipates providing an »nn" B l appropriation in the amount of 
5600,000 to fund the operating costs of the Seneca Hotel. The average operating cost per 
room per month is 5605. The average rent we anticipate receiving on the rooms is 5400 
(tenants currently pay between 5300 and S550). 

On the next page I summarize the expenditures and revenues for the project Note all 
DHS funds are county general fund; the balance of funding for the project comes from 
t enan t rents. The detailed budgets that support these figures are attached. 



102 



Page-4_of A 

Seneca Master Lease 

Aprfl 8, 1999 

Page 4 



SENECA MASTERLEASE SUMMARY BUDGET 





FY 1998-99 


FY 1999-00 




(April 


- June) 


(12 months) 


Expenditures 








Staff 




56,811 


335,988 12.4 FTE with 22% benefits 


Operating Costs 




171,972 


1,130.434 Includes property rental at $55,001 per month 


Equipment 




29,700 


14,500 


Total 




258.483 


1,480,822 


Revenues 








DHS General Fund 




160,563 


599,642 County general fund 


Tenant Rents 




97,920 


881 ,280 In FY 1998-99, assumes 60% occupancy (of 204 
units) for 2 months with an ave. rent of $400; in FY 
99-00, the occupancy increases to an ave. of 90% 


Total 






over 12 months. 




258,483 


1,480,922 



I hope this answers all of your questions. If you need additional information, call me at 557- 
5641. 



Attachments 

FY 98-99 Detailed Budget 
FY 99-00 Detailed Budget 
Summary of hotels lost to fire since 1988 



TOTAL P. 05 



103 



APR-08-1999 10:53 



DEPT OF HUMAN SUCS 



Addendum Page 

Document Date 

DEPARTMENT OF SOCIAL SERVICES CONTRACT BUD 
BY PROGRAM 



415 431 9270 P. 05/13 

py wi 

ATTACHMENT III 
Page 1 of A 



Contractor's Name 


Contract Term 


Check One New Renewal Modification 
If modification, Effective Date of Mod No. of Mod. 


Program 






Total 


Budget Reference Page No.(s) 








Program Term 










Expenditures 

Salaries & Benefits 


$ 


S56.811 


$ 


$ 


Operating Expense 


$ 


$171,972 


S 


S 


Capital Expenditure 


S 


529,700 


$ 


$ 


Subtotal 


$ 


S258.483 


$ 


$ 


Indirect Cost 








[$_ 


Indirect Percentage (%) 
of direct cost (Line 16) 










Total Expenditures 


$ 


$258,483 


$ 


s 


DSS Revenues 


$ 


$ 


$ 


$ 






























































TOTAL DSS REVENUES 


s 


$160,563 


5 


$ 


Other Revenues 

Rental Income 




$97,920 














































Total Revenues 


s 




$ 


$ 


Full Time Equivalent (FTE) 










Prepared by: Telephone No.: 


DSS-CO Review Signature: 




4/8/96 0:00 


DSS#1 







104 



APR-08-1999 10=53 



DEPT OF HUMAN SUCS 



415 431 9270 P. 06/13 



Program Name 

(Same as Line 9 on DSS #1 ) 



f1W\ 



Addendum Page 

Document Date 



ATTACHMENT III 
Page 2 of 4 



Salaries & Benefits Detail 



PREVIOUS 
TRANSACTION 



PROPOSED 
TRANSACTION 



TERM 
POSITION TITLE 


FTE 


SALARIES 


FTE 


SALARIES 


INCREASE 
DECREASE 


Hotel Manager 






1.0 


6,000 




Assistant Manager 






1.0 


4,167 




Desk Clerks 






6.4 


22400 




Head of Maintenance 






1.0 


4,000 




Maintenance Staff 






3.0 


10,000 




















































































































































TOTALS 




$ 




546,567 


5 



EMPLOYEE FRINGE BENE % $ 



0.22 $10,245 $ 



TOTAL SALARIES & BENEFITS S 

DSS #2 



556,811 $ 



105 



APR-08-1999 10=53 



DEPT OF HUMAN SUCS 



415 431 9270 P. 07/13 



Addendum Page 

Document Date 



ATTACHMENT III 
Page 3 of 4 



Program Name , 

(Same as Line 9 on DSS #1) 

Operating Expense Detail 



Expenditure Category 

Rental of Property 

Utilities(Elec. Water, Gas, Scavenger) 
Telephone 

Office Supplies, Postage 

Building Maintenance Supplies and Repair 
Printing and Reproduction 

Insurance 

Staff Training 
Professional Services 



PREVIOUS 
TRANSACTION 
TERM 



PROPOSED 
TRANSACTION 

$110,002.00" 
$20,00000 
$3,500.00" 
S500.00 



_$8,000 00 
$100.00 



S6.700.00 



CONSULTANT/SUBCONTRACTOR DESCRIPTIVE TITLE 
Property Management Fee 



Elevator Maintenance Contract 
Initial Inspection Fee 



OTHER 



$600 00 



$2,250.00 



S16. 320.00 
S2.00000 
$2,000.00 



INCREASE 
(DECREASE 



TOTAL OPERATING EXPENSE 
DSS #3 



$171,97200 



4/8/96 0:00 



106 



APR-03-1999 10=53 



DEPT OF HUMAN SUCS 



415 431 9270 P. 08/13 



Addendum 

Document Date 



Page. 



ATTACHMENT III 
Page 4 of 4 



Program Name 

(Same as Line 9 on DS5 #1} 



Capital Expenditure Detail 
(Equipment and Remodeling Cost) 



EQUIPMENT 








Year 


NSACT 
DEPR'N 


NSACT 


No. 


ITEM/DESCRIPTION 


PURCHASE 
COST EACH 


TOTAL COST 


Life/ epr* 


DEPR-N 


2 


Computer and software 


1,500 




3,000 






Office Furniture 


$ 




1,000 




Maintenance Equipment 


$ 




700 




Security Equipment 


$ 




15.000 






$ 


S 








S 


s 








s 


$ 








s 


$ 








TOTA 


L EQUIPMENT COST 






19,700 









REMODELING 



Description: 

Cosmetic Remodeling 



10.000 



TOTAL REMODELING COST 



10,000 



TOTAL CAPITAL EXPENDITURE 
(Equipment and Remodeling Cost) 
DSS#4 



29,700 



4/8/96 0:00 



107 



APR-08-1999 10:53 



DEPT OF HUMAN SUCS 



415 431 5270 P. 09/13 



f y q<\<oo 



Addendum Page 

Document Date _3/1 5/99_ 
DEPARTMENT OF SOCIAL SERVICES CONTRACT BUD 
BY PROGRAM 



ATTACHMENT IV 
Page 1 of 4 



Contractor's Name 
Tenderloin Housing Cinic, Inc. 


Contract Term 
7/1/99 to 6/30/00 


Check One New Renewal Modification 
If modification, Effective Date of Mod. No. of Mod. 


Program 






Total 


Budget Reference Page No.(s) 








Program Term 










Expenditures 

Salanes & Benefits 


$ 


S335.988 


$ 


$ 


Operating Expense 


$ 


$1,130,434 


$ 


5 


Capital Expenditure 


$ 


514,500 


$ 


5 


Subtotal 


S 


51,480,922 


$ 


S 


Indirect Cost 








$ 


Indirect Percentage (%) 
of direct cost (Line 16) 










Total Expenditures 


s 


$1,480,922 


$ 


$ 


DSS Revenues 


$ 


$ 


S 


$ 






























































TOTAL DSS REVENUES 


s 


S599.&42 


s 


s 


Other Revenues 

Rental Income 




$881,280 














































Total Revenues 


$ 




$ 


$ 


Full Time Equivalent (FTE) 










Prepared by: Kerry Abbott Telephone No.: 771-2427 Date 3/15/9: 


DSS-CO Review Signature: 









dss#i 



4W96 0;00 



108 



ftPR-09-1999 10:54 



DEPT OF HUMAN SUCS 



415 431 9270 P. 10/13 



Addendum Page 

Document Date 3/15/99 



ATTACHMENT IV 
Page 2 of A 



Program Name: Seneca Project 
(Same as Line 9 on DSS #1 ) 



Salaries & Benefits Detail 



PREVIOUS 
TRANSACTION 



PROPOSED 
TRANSACTION 



TERM: 
POSITION TITLE 


4/1/99 to 6/30/99 

FTE SALARIES 


7/1/99 to 6/30/00 
FTE SALARIES 


INCREASE 
DECREASE) 


Hotel Manager 


1.0 


6,000 


1.0 


30,000 




Assistant Manager 


1.0 


4,167 


1.0 


25,000 




Desk Clerks 


6.4 


22,400 


6.4 


134,400 




Head of Maintenance 


1.0 


4,000 


1.0 


23,000 




Maintenance Staff 


30 


10,000 


3.0 


63,000 




















































































































































TOTALS 


12.4 


$46,567 


12.4 


S275.400 


S 



EMPLOYEE FRINGE BENE 22% $10,245 0.22 $60,588 $ 



TOTAL SALARIES & BENEFITS 
DSS #2 



$56,811 



$335,988 $ 



109 



APR-08-1999 10:54 



DEPT OF HUMAN SUCS 



Addendum 

Document Dat 



415 431 9270 P. 11/13 

ATTACHMENT IV 
Page 3 of A 



Program Name . 

(Same as Line 9 on DSS #1) 

Operating Expense Detail 



PREVIOUS 
TRANSACTION 

Expenditure Category TERM 

Rental of Property 3110,002.00 

UtilitJes(Etec, Water, Gas, Scavenger) $20,000 00 
Telephone S3,500.00 

Office Supplies, Postage S500 00 

Building Maintenance Supplies and Re S8.000 00 

Printing and Reproduction $i_0_ 

Insurance S5.700 00 

Staff Training S500.00 

Professional Services S2,250.00 

CONSULTANT/SUBCONTRACTOR DESCRIPTIVE TITLE 
Property Management Fee $16,320 00 



Elevator Maintenance Contract 
Initial Inspection Fee 



$2.00000 
$2.00000 



PROPOSED 
TRANSACTIO 

$650.012.00" 

$120.000 00 

$13,000.00 

$3.00000 

$42.000.00 

$1,200.00 

$40,000 00 

$300.00 

S18 000 00 



$97.920 00 
$12.000 00 



OTHER 
Security Deposit 



Contingency Fund 



TOTAL OPERATING EXPENSE 
DSS #3 



$171.97200 



$82,501 50 
$40,000.00 



it********* 



110 



APR-08-1999 10:54 



Program Name 

(Same as Line 9 on DSS #1) 



DEPT OF HUMAN SUCS 



Addendum Page 

Document Date 



Capital Expenditure Detail 
(Equipment and Remodeling Cost) 



415 431 9270 P. 12/13 

ATTACHMENT IV 
Pase 4 of 4 



EQUIPMENT 






No. 


ITEM/DESCRIPTION 


PURCHASE 
COST EACH 


TOTAL COST 


2 


Computer and software 








Office Furniture 


$ 


500 




Maintenance Equipment 


S 


2,000 




Security Equipment 


$ 


2.000 






S 


s 






s 


s 






$ 


s 






s 


s 



TOTAL EQUIPMENT COST 
REMODELING 



Description: 

Cosmetic Remodeling 



4,500 



10,000 



TOTAL REMODELING COST 

TOTAL CAPITAL EXPENDITURE 
(Equipment and Remodeling Cost) 



10,000 



14,500 



111 




City and County of £an Francisco 

Meeting Minutes 

Finance and Labor Committee 

Members: Supervisors I. eland Yee, Sue Merman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B 

Goodlett Place 

San Francisco, CA 

94102^689 



Wednesday, April 21, 1999 



10:00 AM 
Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



Meeting Convened 

The meeting convened at 10: 10 a.m. 

REGULAR AGENDA 



DOCUMENTS DEPT. 

JUN 1 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



990245 [Appropriation, Public Utilities Commission) 

Ordinance appropriating $690,000, Public Utilities Commission, from Water Fund Balance, 5460,000 from 
Hetchy Fund Balance and $690,000 from Clear Water Fund (a total of 51,840,000) to fund the cost of 
remodeling at 875 Stevenson Street in order to accommodate the PUC staff for fiscal year 1998-1999. 
(Controller) 

(Fiscal impact.) 

2/10/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

4/14/99, CONTINUED Heard in Committee Speakers: Phil Arnold, Public Utilities Commission, Supervisor Ammiano, Supervisor 

Yee. Continued to Apnl 21, 1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst: Michael Quan. Public Utilities Commission: 

Supervisor Ammiano: Supervisor Yee: Phil Arnold, Public Utilities Commission. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 

Ordinance appropriating $690,000, Public Utilities Commission, from Water Fund Balance, 5306,855 from 

Hetchy Fund Balance and $306,855 from Clean Water Fund (a total of 51,303,710) to fund the cost of 

remodeling at 875 Stevenson Street in order to accommodate the PUC staff for fiscal year 1998-1999; placing 

$91,400 on reserve. (Controller) 

(Fiscal impact.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Primed at 4:14 PM on 4/2LV9 



Finance and Labor Committee 



Meeting Minutes 



April 21, 1999 



990604 |Tire Recycling Grant Program] 

Resolution authorizing the Mayor's Office of Community Development to accept and expend, up to $25,000 in 
Tire Recycling Grant Funds from the California Integrated Waste Management Board, (CIWMB); waiving 
indirect cost. (Mayor) 

3/30/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Harvey Rose, Budget Analyst; Jon Pon, Mayor's Office of Community Development. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990609 [Emergency Repair, An/a Street Sewer) 

Resolution approving the expenditure of funds for the emergency work to replace the structurally inadequate 
brick sewer on Anza Street from 7th Avenue to 8th Avenue - $194,291. (Public Utilities Commission) 
3/31/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Harvey Rose. Budget Analvst; Robert Badglev. Public Utilities Commission; Supervisor Bierman; Supervisor 
Yee. 

RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990610 [Airport Concession Lease) 

Resolution approving the New International Terminal Newsstand Lease between CalStar Retail, Inc., a Small 
Business Enterprise Set-Aside, and the City and County of San Francisco, acting by and through its Airport 
Commission. (Airport Commission) 

3/31/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Jon Ballesteros. 
RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990611 [Airport Concession Lease) 

Resolution approving the New International Terminal Nature Theme Store lease between Discovery Channel 
Stores, Inc., and the City and County of San Francisco, acting by and through its Airport Commission. 
(Airport Commission) 

3/31/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 
Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Jon Ballesteros. 
RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990612 [Airport Concession Lease) 

Resolution approving the New International Terminal Golf Shop Lease between Golf on the Avenue, Inc., and 
the City and County of San Francisco, acting by and through its Airport Commission. (Airport Commission) 
3/31/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 
Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Jon Ballesteros. 
RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 4:14 PM on 4rt2W> 



Finance and Labor Committee 



Meeting Minutes 



April 21, 1999 



990673 [Lease Agreement, Airport - South City Industrial Company, LLC] 

Resolution approving lease agreement for office/warehouse space at 245 South Spruce Avenue, South San 
Francisco, between South City Industrial Company, LLC, as lessor, and the City and County of San Francisco, 
acting by and through its Airport Commission, as lessee. (Airport Commission) 
4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Jon Ballesteros; Supervisor Yee; Supervisor 
Ammiano. 

RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990684 [1999 Affordable Housing Bond Salel 
Supervisor Bierman 

Resolution authorizing and directing the sale of not to exceed $20,000,000 City and County of San Francisco 
taxable general obligation bonds (Affordable Housing) Series 1999A; prescribing the form and terms of said 
bonds; authorizing the execution, authentication and registration of said bonds; providing for the appointment 
of depositories and other agents for said bonds; providing for the establishment of accounts related thereto; 
approving the forms of official notice of sale of bonds and notice of intention to sell bonds; directing the 
publication of notice of sale and notice of intention to sell bonds; approving the form and execution of the 
official statement relating thereto; approving the form of the continuing disclosure certificate; approving 
modifications to documents; ratifying certain actions previously taken; and granting general authority to city 
officials to take necessary actions in connection with the authorization, issuance sale and delivery of said 
bonds. 

4/12/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Kiarcia Rosen, Director. Mayor's Office of 
Housing; Laura Opsahl. Mayor's Office, Public Finance; Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990431 [Appropriation, Ethics Commission] 

Ordinance appropriating $56,000, Ethics Commission, from the General Fund Reserve to an On-Line 
Electronic Filing Program through a work order with the Department of Telecommunication Systems (DTIS) 
for fiscal year 1998-1999. (Controller) 

2/26/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Ginny Vida Executive Director, Ethics 
Commission; Supervisor Ammiano; Paul Melbostad, Ethics Commissioner; Charles Marsteller, S.F Common 
Cause; Supervisor Ammiano; Supervisor Yee. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 4:14 PM on 4/22W 



Finance and Labor Committee 



Sleeting Minutes 



April 21, 1999 



990606 | Health Service Trust Fund Contribution] 

Resolution establishing monthly contribution amount to Health Service Trust Fund (City and County of San 
Francisco, Unified School District, and Community College for fiscal year 1999-2000). (Department of 
Human Resources) 

(Fiscal impact.) 

3/29/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Ann Summercamp, Health Senice System; 
Kay Walker, S. F. Retirees' Association; Jean Thomas; Supervisor Yee. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990626 [Home Health Contractual Services] 
Supervisors Ammiano, Bierman 

Resolution authorizing the Department of Public Health to expend funds and add staff resources to replace 
grant funded home health contractual services with services provided by City staff. 
4/5/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Monique Zmuda, Department of Public Health. 
RECOMMENDED., by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990678 [Reserved Funds, Dept. of Public Health] 

Hearing to consider release of reserved funds, Department of Public Health, (proceeds from sale of Bonds. File 
101-97-17, Ordinance No. 369-97), m the amount of $86,950, to fund contractual services for the 
improvement of the CMED Building located at 2789 25th Street. (Department of Public Health) 
4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Monique Zmuda, Department of Public Health. Department directed to 
return to the Finance and Labor Committee after the preliminary design is complete, present the various 
design components, and give an indication of how the remainder of the reserved money will be spent. 
APPROVED AND FILED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990508 [Commuter Choice Program| 

Supervisors Ammiano, Newsom, Bierman 

Resolution authorizing the Department of Administrative/Commute Assistance Program to create and 

implement commuter choice programs enabling employers to offer employees the option to "pre-tax" 

commute-related transportation expenses under Section 132 of the Internal Revenue Code of 1986, as 

amended. 

3/1 5/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Supervisor Ammiano; Harvey Rose; Budget Analyst; Supervisor Yee. 

Amended on page I, line 3, after "implement" add "a one-year pilot"; and on line 4. change "programs " to 

"program". On page 2, line 16, after "year", add "to determine if the program shall be permanently 

established. " New title. 

AMENDED. 



City and County of San Francisco 



Printed at 4:14 PM on 4/1V99 



Finance and Labor Committee Meeting Minutes April 21, 1999 

Resolution authorizing the Department of Administrative Commute Assistance Program to create and 
implement a one-year pilot commuter choice program enabling employers to offer employees the option to 
"pre-tax" commute-related transportation expenses under Section 132 of the Internal Revenue Code of 1986, 
as amended. 

RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990627 [Lease of Real Property, Windsor Hotel| 
Supervisor Ammiano 

Resolution authorizing and approving the master lease by and between the City and County, for the 
Department of Public Health, as tenant, and Michael J. Bovo Associates Incorporated, as landlord, for the 
Windsor Hotel, located at 238 Eddy Street. 

(Fiscal impact.) 

4/5/99, ASSIGNED UNDER 30 DAY RULE to Finance and Labor Committee, expires on 5/5/1999. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Monique Zmuda, Department of Public 

Health; Supervisor Ammiano; Supervisor Bierman; Mark Trass, Department of Public Health. Oppose: 

Edward Evans, Eric James. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 

Resolution authorizing and approving the master lease by and between the City and County, for the 

Department of Public Health, as tenant, and 238 Windsor Associates, as landlord, for the Windsor Hotel, 

located at 238 Eddy Street. 

(Fiscal impact.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



SPECIAL ORDER - 11:00 A.M. 



990311 [MBE/WBE/LBE Program] 
Supervisor Yee 

Hearing to consider the status of the City's Minority Business Enterprise/Women Business Enterprise/Local 
Business Enterprise (MBE/WBE/LBE) program, specifically if the departments are on track for meeting their 
goals and the status of the Human Rights Commission's implementation of a data tracking system. 
2/17/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

3/31/99, CONTINUED TO CALL OF THE CHAIR Heard in Committee. Speakers: Mane Hamson; Ileen Hernandez 
Heard in Committee. Speakers: Supervisor Yee; Ted Lakey. Deputy City Attorney; John Madden. Assistant 
Controller; Marivie Bamba, Human Rights Commission; Robert Carlson; Department of Public Works; 
Arnold Baker, Chief of Staff , Municipal Railway; Veronica Sanchez, S.F. Port; Sandra Crumpler. Airport 
Commission; Supervisor Brown; Edwin Lee, Purchasing; Ileen Hernandez; Harold Yee, Coalition on 
Economic Equity; Daryl Bishop. Lets Get Busy Contractors; Marie Harrison; Oran Stellstrom; Willie 
Ratclijfe; Sam Quan; Stanley Chan; Supervisor Bierman; Supervisor Ammiano. 
CONTINUED TO CALL OF THE CHAIR by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 5 Primed at 4:14 P\t on 4/22/99 



Finance and Labor Committee Meeting Minutes April 21, 1999 



ADJOURNMENT 



The meeting adjourned at 1:05 p.m. 



City and County of San Francisco 6 Printed at 4:14 PM on 4/22/99 



3 

i 

IrJ ft 



$<.-n 



CITY AND COUNTY 




BOARD OF SUPERVISORS 



Public Library,Gov't Info. Ctr., 5 th Fir. 
Attn: Susan Horn 



ofsanfrancisSP CUM ENTS DEPT. 
APR 2 1999 

SAN FRANCISCO 
p UBLIC LIBRARY 



BUDGET ANALYST 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



April 16, 1999 
TO: ^Finance and Labor Committee 

FROM: .Budget Analyst 
SUBJECT: April 21, 1999 Finance and Labor Committee Meeting 



Item 1 - File 99-0245 

Note: This item was continued by the Finance and Labor Committee at its 
meeting of April 14, 1999. 



Department: 
Item: 



Amount: 


$1,840,000 


Sources of Funds: 


$690,000 




460,000 




690.000 




$1,840,000 


Description: 


The propc 



Public Utilities Commission'(PUC) 

Supplemental appropriation of (1) $690,000 from 
Water Fund balance, (2) $460,000 from Hetch 
Hetchy Fund balance and $690,000 from Clean 
Water Fund balance, for a total of $1,840,000 to 
fund the cost of remodeling of office space at the 
875 Stevenson Street building, to be used by PUC 
staff. 



Water Fund balance 
Hetch Hetchy Fund balance 
Clean Water Fund balance 
Total 



supplemental appropriation of 
$1,840,000 would be used to fund renovations, 
utility upgrades and furnishings for approximately 
28.241 useable square feet of space, leased by the 
PUC, on the third floor at 875 Stevenson Street. 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

PUC's ten-year Capital Improvement Program 
from 1998 through 2008 reflects Program costs to 
improve the system's reliability, water quality and 
water supply at a cost of over $2 billion to complete. 
As part of this effort, in November of 1997, the San 
Francisco voters approved Water System 
Reliability and Seismic Safety Revenue Bonds of 
$157 million to provide funds for acquiring and 
constructing reliable and seismic safety 
improvements to the water system and approved 
Safe Drinking Water Revenue Bonds of $147 
million to provide funds for acquiring and 
constructing safe drinking water improvements 
related to the City's water system. The total 
authorized amount for these two bonds is $304 
million. 

According to Mr. Phil Arnold of the PUC, in order 
to undertake these capital improvements for 
improved water treatment facilities, the PUC has 
been hiring additional staff for the necessary 
design and engineering phases of these projects 
with previously approved project funds. Mr. Arnold 
notes that the PUC's 1998-99 budget included 
funds and the authorization to hire 69 new FTE 
positions for the Utilities Engineering Bureau. Mr. 
Arnold reports that there are currently 
approximately 70 employees in PUC's engineering 
section and that the PUC is in the process of hiring 
an additional 50 employees for this section, for a 
total of 120 employees. 

The PUC engineering staff is currently located in 
leased space at 1155 Market Street. These 70 PUC 
engineering positions currently occupy one entire 
floor, or approximately 12.000 square feet. 
Therefore, each of these employees has an average 
of approximately 171 square feet per person. 
However, Mr. Arnold reports that the staff is 
currently quite crowded in the existing space, using 
conference rooms, the file area and other space to 
accommodate the engineering staff. The PUC 
occupies four floors of the 1155 Market Street 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

2 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



facility, for a total of approximately 48,000 square 
feet. 

Mr. Arnold reports that, by July 1, 1999, the PUC 
plans to locate 111 of the 120 PUC engineering 
emploj'ees to the 875 Stevenson Street location, 
which will have approximately 28,241 of useable 
square feet on the third floor for the 120 
engineering positions, or an average of 254 square 
feet for each engineering position. This reflects an 
average increase of 49 percent, from 171 square 
feet to 254 square feet, or an average increase of 83 
square feet per empkyee when compared with the 
existing staff level and space at 1155 Market 
Street. However, Mr. Arnold indicates this is not a 
fair comparison because of the overcrowded 
conditions of 1155 Market Street. 

Mr. Steve Legnitto of the Real Estate Department 
reports that the PUC's lease at 875 Stevenson 
Street contains a total of 32,310 square feet, 
including 28,241 directly useable space for the PUC 
and an additional 4,069 square feet for the prorated 
share of the lobby and hallways. Mr. Legnitto 
indicates that based on the total net rentable 
32,310 square feet of space, this lease, including 
utilities, janitorial and security services, will cost 
the PUC approximately $1.78 per square foot per 
month, resulting in a monthly total cost of $57,673 
or approximately $692,076 annually. According to 
Mr. Tony DeLucchi of the Real Estate Department, 
the lease costs alone, without utilities, janitorial 
and security services, are approximately $1.33 per 
square foot per month, or $16 per square foot per 
year at 875 Stevenson Street. 

Mr. Arnold reports that in November of 1998 the 
Public Utilities Commission approved this lease at 
875 Stevenson Street for PUC engineering staff to 
occupy the third floor of the 875 Stevenson Street 
building. According to Mr. Legnitto, this space for 
the PUC was not subject to the Board of 
Supervisors approval because the space does not 
represent a new lease for the City. Rather, the City, 
through the Real Estate Department, has an 
existing lease for the 875 Stevenson Street 
BOARD OF SUPERVISORS 
BUDGET ANALYST 
3 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

building, which was previously approved by the 
Board of Supervisors in 1994 and again amended in 
1996. According to Mr. DeLucchi, now that various 
City departments have moved from 875 Stevenson 
Street to the renovated City Hall, the Real Estate 
Department is backfilling the vacated space at the 
875 Stevenson Street facility, with the concurrence 
of the City Hall Policy Committee. Mr. DeLucchi 
reports that the City Hall Policy Committee, 
comprised of representatives from the Controller's 
Office, Treasurer's Office, Department of 
Administrative Services, Mayor's Office, 
Department of Public Works and other City staff 
representatives, have been meeting for over a year 
to provide direction and reuse of City Hall and the 
surrounding office space in the Civic Center. 

The proposed space to be occupied by the PUC at 
875 Stevenson Street was previously occupied by 
the Controller's and the Assessor's Offices, and for 
storage space for the Treasurer/Tax Collector's 
. Office, prior to their move back to City Hall in 
January of 1999. According to Mr. Arnold, 
approximately 25 percent of the 28,241 square feet 
of useable space on the third floor is unfinished and 
was previously used for records storage. 

Budget: Tenant Improvements 5834,566 



Architectural Fees 


58,420 


Furnishings 


463,221 


Construction Administration 


56,436 


Telecomm unications 


117,721 


Moving Expenses 


24.000 


Total 


SI, 554.364 



Although the proposed supplemental appropriation 
requests a total of $1,840,000, the current budget 
requirement, as provided by the PUC, the 
Department of Telecommunications and 
Information Sendees (DTIS) and the Real Estate 
Department, is $1,554,364, or $285,636 less than is 
being proposed in the supplemental appropriation. 
However, as explained in Comment 11 below, the 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

4 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Mayor's Office requests tbat $91,400 of this amount 
be placed on reserve for consideration in connection 
with a future supplemental appropriation involving 
General Fund costs for the 875 Stevenson 
renovation and relocation. 

Attachment 1, provided by the PUC, contains a 
detailed breakdown of the $463,221 being 
requested for all of the furnishings. Attachment 2 
prepared by DTIS identifies the cost breakdown for 
the $117,721 of expenses of the Department of 
Telecommunications and Information Services. 
Attachment 3 provided by the Real Estate 
Department contains a detailed breakdown of the 
$834,566 for Tenant Improvements. The 
Architectural Fees of $58,420, which are seven 
percent of the Tenant Improvement costs of 
$834,566, are to be paid to Komourous-Towey 
Architects (KTA), who was selected by the 
administrator of the Mart, the landlord of 875 
Stevenson Street. The Construction Administration 
.- Fee of $56,436, which is approximately 4.3 percent 
of the combined Tenant Improvement ($834,566) 
and Furnishings ($463,221) total of $1,297,787, 
which would be paid to the Mart, the landlord of 
875 Stevenson Street, to oversee and manage the 
improvements and furnishings for the leased space. 

Comments: 1. Mr. DeLucchi reports that the $1,554,364 

estimated costs for the PUC to relocate into the 875 
Stevenson Street facility have been revised 
downward from the $1,840,000 initially estimated 
in the subject supplemental appropriation due to 
the Real Estate Department's ongoing negotiations 
with the landlord of the building. According to Mr. 
DeLucchi, the major negotiations with the landlord 
of the 875 Stevenson Street facility for the PUC 
space have been completed, although, as with every 
project, there may be some minor additional 
adjustments in cost for the PLfC. 

2. Mr. Legnitto reports that the City originally 
entered into a lease for 150,000 square feet of space 
on five floors at the 875 Stevenson Street facility on 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

5 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

June 16, 1994. This lease was to expire in 1997, 
although there were two six-month extension 
options. In November of 1996, the Board of 
Supervisors approved an extension of the 875 
Stevenson Street lease until November of 2002, 
because the City needed additional time to occupy 
the building and the City was considering a plan to 
purchase the 875 Stevenson Street facility. 
According to Mr. DeLucchi, the City is no longer 
considering the purchase of this building. The 
existing lease for the 875 Stevenson Street facility 
has three different options to extend the lease for 
from six months up to a total of 7.5 extra years 
(through May, 2010) beyond the current expiration 
of November, 2002, with the provision that the rent 
would be adjusted to 95 percent of the then 
prevailing market rental rates. 

3. Mr. Legnitto notes that prior to the City 
occupying the 875 Stevenson Street facility in early 
1995, the City spent approximately $5,280,000 to 
- renovate and upgrade four floors of this building, or 
an amortized cost over the four-year period that 
these facilities were occupied of approximately 
$1,320,000 per year. Mr. Legnitto reports that the 
Department of Technology and Information 
Services (DTIS) moved in approximately a year 
later in 1996, incurring additional renovation costs 
of approximately $1,290,000, for a total renovation 
cost to the 875 Stevenson Street facility of 
$6,570,000. However, Mr. Legnitto notes that the 
lessor of 875 Stevenson Street provided a credit to 
the City of approximately a total of $2 million 
against the cost of tenant improvements incurred 
by the City, such that the City only incurred 
expenses of approximately S4. 570.000 ($6,570,000 
total less $2,000,000 credit) for such tenant 
improvements. Nevertheless, the initial renovation 
cost of $5,280,000 includes approximately 
$1,362,890 to renovate the third floor space, which 
the PUC is now proposing to expend an additional 
$1,554,364 to further renovate and upgrade the 
same space, which would result in total renovation 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

6 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



and upgrade expenses by tbe City of $8,124,364 for 
this leased facility since just 1995. 

4. According to Mr. Legnitto and Mr. Charles Dunn 
of the Real Estate Department, the reasons the 
PUC needs to spend approximately $1,554,364 to 
renovate and furnish this space after 
approximately $1,362,890 was spent on this same 
space only approximately four years ago is because 
(1) the original $1,362,890 reflected only minimal 
tenant improvements to the space, (2) much of the 
original budgeted improvements, such as carpeting 
and electrical wiring, only had a useful life of three 
3'ears, (3) the Americans With Disability (ADA) and 
other building code requirements have changed and 
(4) whenever one City department is replaced by 
another City department, some renovations are 
always required. Of the total $834,556 of tenant 
improvements, it should be noted that 
approximately $8,000 is to be spent to remove the 
existing carpeting and another $127,048 is to be 

• _ spent on installing new carpeting for the third 
floor. 

5. As previously noted, the City's lease at 875 
Stevenson Street expires in November of 2002, 
although the City has three options to extend the 
existing lease for up to an additional 7.5 years 
(through May, 2010) at 95 percent of the then 
prevailing market rental rates. If the proposed 
supplemental appropriation is approved, the value 
of the tenant improvements ($834,566), 
architectural fees ($58,420), construction 
administration ($56,436) and most of the 
telecommunications ($80,590) costs, totaling 
$1030,012, would be lost if the City vacates the 875 
Stevenson building in 2002, at an amortized cost of 
$343,337 per year for these renovations, over a 
three-year period. According to Mr. DeLucchi, it is 
likely, although he can make no assurances, that 
the PUC will remain in the 875 Stevenson Street 
facility for approximately five years, which would 
reduce the amortized cost of the proposed 
renovations to $206,002 per year. Mr. Arnold 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

7 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

reports that the furnishings to be purchased at an 
estimated cost of $463,221 would all be of a 
modular-type, which would allow the PUC to move 
such furnishings to a new location. 

6. According to Mr. Legnitto, since the proposed 
lease was renegotiated in 1996, when lease rates 
were less expensive, the existing proposed lease 
rate of $1.33 per square foot per month payable by 
the PUC represents less than the current fair 
market value for such a building. Mr. DeLucchi 
estimates that the fair market value rate for a 
comparable lease is approximately $1.75 per square 
foot per month at this time, or approximately $.42 
per square foot per month more than the rate at 
875 Stevenson Street. Mr. DeLucchi notes that 
fully servicing the 875 Stevenson Street lease, 
which would include providing utility, security and 
janitorial costs, increases the 875 Stevenson facility 
costs to $1.78 per square foot per month, and that 
comparable servicing costs would be added to other 

-. market rate leases. 

7. Mr. Arnold reports that the space proposed to be 
vacated, when approximately 70 engineering staff, 
currently located at 1155 Market Street, are 
relocated to 875 Stevenson Street, would be used 
for the PUC's project management, construction 
management and contract management staff, that 
are also currently expanding due to the capital 
improvement projects that need to be completed 
over the next ten years. According to Mr. Arnold, 
under the proposed supplemental appropriation, all 
new furnishings would be purchased for the 875 
Stevenson Street facility. As shown in Attachment 
4, provided by Mr. Arnold, a total of 66 new staff 
positions, subject to Board of Supervisors approval, 
are anticipated to be added from FY 1998-1999 
through FY 2000-2001, to be located at 1155 
Market Street, such that the existing furnishings 
at 1155 Market Street need to remain there for use 
by these new PUC staff that would use that 
vacated space. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



When queried by the Budget Analyst regarding the 
need for an additional $463,221 of new office 
furniture, Mr. Arnold responded that this would 
provide all new office furnishings for the 111 staff 
that would be relocated to 875 Stevenson Street. A 
review of the specific furnishings reveals that the 
PUC is requesting to furnish four conference rooms 
(one large and three small) and 15 private offices, 
in addition to 96 work stations for the engineering 
and support staff. Mr. Arnold notes that the PUC 
engineering staff at 1155 Market Street currently 
have three small conference rooms and five private 
offices, and that given the number of staff working 
together on various projects, there is a great need 
for conference rooms and private offices where the 
staff can work together on projects. Although the 
proposed renovations and furnishings will result in 
an increase of one conference room and ten private 
offices, it is difficult for the Budget Analyst to 
identify whether such an increase is the 
appropriate number of conference rooms or private 
offices for the expanded needs of the PUC. 
Similarly, it is difficult for the Budget Analyst to 
determine what individual pieces of furniture are 
necessary, or whether the type of furniture selected 
is the most appropriate, efficient and economical 
for the PUC. However, the Budget Analyst does 
question the overall purchase of new furnishings 
for new capital project staff in this temporary 
leased facility, given the fact that it is likely that 
the PUC will be moving all of its staff to a new 
facility at 525 Golden Gate Avenue in 
approximately five years, and it is likely that the 
PUC will be requesting new furnishings to be 
purchased at that time. 



8. The proposed source of revenues to pay for this 
supplemental appropriation are each of the utility's 
Fund balances. The current fund balance in the 
Water Fund is $27,938,000. The current fund 
balance in the Hetch Hetchy Fund is $1,487,000. 
The current fund balance in the Clean Water Fund 
is $47,745,000. Mr. Arnold reports that these fund 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

9 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

balances are a result of revenues received from 
water and sewer service rates charged to PUC's 
customers. In June of 1998, San Francisco voters 
approved Proposition H, which froze water and 
sewer service rates until July 1, 2006, except in 
certain circumstances. Therefore, Mr. Arnold 
reports that the proposed supplemental 
appropriation cannot result in increased rates to 
PUC's customers until at least July 1, 2006. 

9. Although not the subject of the proposed 
supplemental appropriation, Mr. Ben Rosenfield of 
the Mayor's Office reports that staff from four other 
City departments, in addition to the PUC, are 
scheduled to be relocated to the 875 Stevenson 
Street facility. Mr. Rosenfield notes that a total of 
$464,880 of General Fund revenues were placed on 
reserve by the Board of Supervisors in the FY 1998- 
99 budget of the Department of Real Estate to 
finance the costs of renovations and furnishings at 
875 Stevenson Street for these four General Fund 
departments. According to Mr. Rosenfield, the 
Department of Real Estate anticipates requesting 
the release of these General Fund monies in the 
near future, but is not currently ready to request 
the release of such funds at this time, or to provide 
detailed information on the amount of space and 
the costs for each of the four General Fund 
departments. 

10. However, the four General Fund departments 
that are proposed to relocate into 875 Stevenson 
Street and a general description of where the 
Departments are currently located is as follows: (1) 
The Public Administrator-Guardian, which is 
currently located at 25 Van Ness, a City-owned 
building. It is anticipated that the 25 Van Ness 
vacated space would then be occupied by the 
Department of Parking and Traffic for their new 
Traffic Control Center and for their relocated 
Residential Permit Parking Program, which is 
currently located in the Performing Arts Garage. 
(2) The Controller's Payroll and Personnel Division, 
which is currently located in leased facilities at 160 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

10 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



South Van Ness. According to Mr. Legnitto, the 
lease on the facilities at 160 South Van Ness 
expires on June 30, 1999 and an extension of this 
lease is currently being renegotiated by the Real 
Estate Department for use by the Department of 
Human Services (DHS) for their new hires and to 
relocate staff from other DHS work sites. (3) 
MUNI's Management Information System (MIS) 
and Security, which is currently located at 425 
Mason Street, the Presidio facility and on Turk 
Street, in order to consolidate such staff in the 
Civic Center area. (4) Assessor's staff, currently 
located on the third floor of 875 Stevenson would be 
relocated to the ground floor of the 875 Stevenson 
leased facility in order to consolidate the Assessor 
and Recorder functions on the first floor and to 
provide the entire third floor for use by the PUC. 

11. Mr. Rosenfield requests that the Board of 
Supervisors reserve $91,400 of the supplemental 
appropriation request of $1,840,000 for the 
anticipated costs of relocating the Assessor's Office 
from the third floor of 875 Stevenson to the first 
floor so that the PUC can relocate to the third floor. 
Mr. Rosenfield notes that the Assessor would not be 
required to move except for the fact that the PUC is 
requesting the use of the entire third floor. The cost 
of this move, Mr. Rosenfield states, should 
therefore be attributed to the PUC, and not to the 
General Fund. 

12.The Budget Analyst notes that when City 
employees moved back into City Hall in January of 
1999, a total of approximately $5 million in various 
types of furniture and equipment was provided for 
these employees. Manj r of these City employees, 
including employees from the Treasurer/Tax 
Collector's Office, Recorder/Assessor's Office, 
Controller's Office, etc. were previously located at 
875 Stevenson Street. According to Mr. DeLucchi, 
those furnishings were left behind at 875 
Stevenson Street. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

11 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

When queried regarding why the PUC could not 
make use of this remaining furniture at 875 
Stevenson Street, Mr. Rosenfield reported that the 
furnishings remaining at 875 Stevenson, that are 
in good shape, would be used by the four General 
Fund departments that are proposed to occupy 875 
Stevenson Street. However, Mr. Rosenfield also 
advises that these General Fund departments will 
also be purchasing some additional new 
furnishings, although the amounts and costs of 
such new furnishings are not available at this time. 
Because the request for release has not yet been 
made for the $464,880 for renovations and 
furnishings at 875 Stevenson Street for the four 
General Fund departments, the Budget Analyst 
cannot determine to what extent that the furniture, 
now remaining used at 875 Stevenson Street could 
be reused by these General Fund departments, and 
therefore eliminate the need for at least a portion of 
the subject $463,221 in requested new funds for 
PUC furnishings. 

13. The Budget Analyst also notes that, according 
to Mr. DeLucchi, approximately 66,500 square feet 
of the total approximately 150,000 net rentable 
square feet at the 875 Stevenson Street facility is 
currently vacant. At a lease cost of SI. 33 per square 
foot per month, excluding utilities, security and 
janitorial services, the City is currently spending 
approximately $88,445 per month for this vacant 
space. The Budget Analyst notes that City 
employees vacated the 875 Stevenson Street 
faculty in December of 1998 and January of 1999, 
and that it is not anticipated that the PUC or other 
City departments would be able to relocate into 
this space until at least the Summer of 1999, 
leaving this space vacant for at least six months, at 
an approximate cost of at least $530,670 to the 
City. 

However, Mr. Rosenfield reports that the PUC's 
budget for FY 1998-99 included rent for the third 
floor space from the beginning of January of 1999 
through the end of the current fiscal year. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Therefore, Mr. Rosenfield reports that the PUC will 
pay rent for this leased from January of 1999 
through the time the PUC actually moves into the 
leased space. Assuming the PUC moves into the 
875 Stevenson Street facility on July 1, 1999, they 
will be paying a total of approximately $346,038 for 
the six-month period for which they did not occupy 
this space. 

14. In summary, the Budget Analyst raises the 
following concerns about the proposed 
supplemental appropriation: (1) the 49 percent 
average increase of space per staff position from 
approximately 171 square feet per person at 1155 
Market Street to 254 square feet per person at 875 
Stevenson Street, (2) the existing lease at 875 
Stevenson Street expires in November of 2002, 
although there are options to extend the lease up to 
7.5 years, with rent adjustments to 95 percent of 
the then fair market rate, (3) the City has already 
spent $6,570,000 to renovate this building, of which 
. $1,362,890 included renovations to the third floor, 
(4) the $6,570,000 previously spent and the 
proposed supplemental appropriation of 
$1,554,364, to again renovate the third floor, only 
approximately four years after the initial 
renovations to the third floor, results in a total of 
$8,124,364 to be spent on this leased facility since 
1995, (5) whether the increased number of PUC 
conference rooms, private offices and the type of 
furniture are appropriate, efficient and economical, 
given that the PUC will likely be moving to a new 
permanent facility in approximately five years, and 
will likely be requesting new furnishings at that 
time, (6) $464,880 of General Fund monies are on 
reserve for additional renovation and furnishing 
costs for 875 Stevenson Street for four City 
departments, and is not available for review at this 
time, (7) an additional $91,400 is requested by the 
Mayor's Office from the subject PUC supplemental 
appropriation for the Assessor's Office, although no 
details are currently available and the funds were 
not included in the original PUC or Mayor's 
supplemental appropriation request, (8) the City 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

13 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

has an ongoing lease to occupy the current vacant 
space and is therefore paying rent on this vacant 
space at a rate of $88,445 per month, (9) the PUC 
will pay rental costs for the approximately six- 
month period that they have not occupied the third 
floor space. 

15. At the April 14, 1999 Finance and Labor 
Committee meeting, the Committee continued this 
ordinance and requested that the PUC significantly 
reduce the proposed supplemental appropriation, 
by reducing the proposed furnishing expenses and 
the carpeting expenses by 50 percent, and by 
eliminating any unnecessary tenant improvements. 
Overall, the Committee requested a reduction of 
$300,000 from the existing budget. In response, the 
PUC has provided Attachment 5, which identifies a 
total proposed reduction of $229,941, including 
$127,286 for reductions for furnishings and 
$102,655 for reductions for carpeting. 

As reflected in Attachment 5, provided by the PUC, 
the original proposed estimate of $463,221 for 
furnishings would be reduced by $127,286, to 
$335,935, a reduction of 27.4 percent, instead of a 
50 percent reduction as requested by the Finance 
and Labor Committee. This reduction would occur 
by (1) only purchasing new furnishings for 84 staff, 
four conference rooms and one training room, 
instead of purchasing new furnishings for 111 staff, 
four conference rooms, one reception area, and 
various miscellaneous furnishings and (2) reusing 
existing furnishings from 875 Stevenson Street and 
1155 Market Street. 

In addition, the previous estimate of $834,566 for 
tenant improvements, which included carpeting 
and related installation costs of $134,789, would be 
reduced by $102,655, to $731,911, a reduction of 
12.3 percent of all tenant improvements. As shown 
in Attachment 5, of the total original estimated 
$134,789 for new carpeting, $102,655 would be 
eliminated, a reduction of 76 percent, for a reduced 
total of $32,134 for carpeting, by only installing 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

14 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



new carpeting in those areas of the third floor of 
875 Stevenson Street where no carpeting currently 
exists. However, no additional reductions have 
been proposed in the tenant improvements by the 
PUC, as requested by the Finance and Labor 
Committee. 

Although not shown in Attachment 5, the Budget 
Analyst notes that the Architectural Fees, which 
were based on seven percent of the Tenant 
Improvements, should then also be reduced from 
$58,420 to $51,234, a reduction of $7,186. 
Similarly, the Construction Administration costs, 
which are approximately 4.3 percent of the 
combined Tenant Improvements and Furnishings 
should also be reduced from $56,436 to $45,917, a 
reduction of $10,519. 

Therefore, the recommended reductions of $229,941 
proposed by the PUC, together with the additional 
$17,705, recommended by the Budget Analyst's 
Office, would result in a total recommended 
reduction of $247,646, as follows: 



Original Budget 


Revised Budget 


Savings 


Tenant Improvements $834,566 


$731,911 


$102,655 


Architectural Fees 58,420 


51,234 


7,186 


Furnishings 463,221 


335,935 


127,286 


Construction Administration 56,436 


45,917 


10,519 


Telecommunications 117,721 


117,721 





Moving Expenses 24.000 


24.000 





Total $1,554,364 


$1,306,718 


$247,646 



Recommendations: 



However, the Budget Analyst notes that if the 
Finance and Labor Committee's total recommended 
reductions of $300,000 were imposed, the proposed 
supplemental appropriation would be reduced from 
$1,554,364 to $1,254,364, a further savings of 
$52,354. 

Amend the proposed ordinance to reduce the 
supplemental appropriation from $1,840,000 to 
$1,398,118, a savings of $441,882, and reserve 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

15 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

$91,400 for the cost of the relocation of the 
Assessor's Office, as explained in the Budget 
section and Comment 11 of this report. Reductions 
of an additional $52,354, as indicated by the 
Finance and Labor Committee, in order to obtain a 
net total reduction of $300,000, are a policy matter 
for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

16 



875 Stevenson 
Furnishing Cost Estimate 



TvDe of SDace 


Qntv. 


I 


Cost/item 




Total 


Work Station 


96 


S 


4,025 


S 


386,400 


Private Office 












Bureau Mgr. 
Section Mgr. 
Supervisor 


1 
4 
10 


s 
s 
s 


4,206 
3,855 
2,539 


$ 

s 
s 


4,206 
15,420 
25,390 


Conference Room 
Small 
Large 


3 

1 


s 
s 


4,855 
9,265 


s 
s 


14,565 
9,265 


Reception 


1 


$ 


604 


s 


604 


Sub-total: 








s 


455,850 


Misc. 

Lateral Files 


17 


s 


260 


s 


4,416 


Bookshelves 


20 


s 


148 


s 


2,956 



Attachment 1 
Page 1 of 4 



Total: 



463,221 







17 



Attachment 1 
Page 2 of A 



875 Stevenson 
Furnishing Cost Estimate 



Item 



Work Station, Typical 



Item Description 



Modular Workstation Herman Miller Series 2 

(includes panels, worksurfaces. overhead cabinet, 
pedestal cabinet, task light) 

Keyboard Tray Workrite Straightway w/ adjustable Arm 

Ergonomic Chair Eckadams Task Chair w/ arms, burgundy 

Vertical File HON Vertical File, legal, 4 drawer, grey 

Bookshelf HON Bookcase, 47*h, grey 



Unit Cost 
S 5,000.00 

S 312.00 

S 435.00 

S 275.00 

S 161.00 



Qntv. 



List Pnce: 



Cost 
1 S 5.000.00 

1 S 312.00 
1 S 435.00 
1 S 275.00 
1 S 161.00 
S 6.1 83.00 



City"s Pnce (40% discounts tax): S 4.025. 



Bureau Manager's Office 



Desk 



HON 10700 Radius Edge Series, U-grouping. Medium Oak 



Keyboard Tray 
Bookshelf 
Ergonomic Chair 
Conference Table 
Side Chair 



Peninsula Top w/ Edge Panel 

Bridge 

Lateral File w/ Credenza 

Lateral File 

Overhead Storage Unit 

Workrite Straightway w/ adjustable Arm 

HON Bookcase, \T h. black 

Eckadams High Back Chair w/ arms, burgundy 

HON Rectangular Table, 36"x72". Med. OaK 

HON Guest Arm Chair, Oak/Burgundy 



S 639.00 

S 218.00 

S 909.00 

S 596.00 

S 855.00 

S 312.00 

S 161.00 

S 555.00 

S 525.00 

S 255.00 



List Pnce: 



1 S 639.00 

1 S 218.00 

1 S 909.00 

1 S 596.00 

1 S 855.00 

1 S 312.00 

2 S 322.00 
1 S 555.00 
1 S 525.00 
6 S 1.530.00 

S 6,461. 00 



City's Price (40% discounts tax): S 4.206.1 1 



Section Manager's Office 



Desk 



Keyboard Tray 



HON 10700 Radius Edge Series. U-grouping, Medium Oak 

Peninsula Top w/ Edge Panel 

Bridge 

Lateral Ffle w/ Credenza 

Lateral Re 

Overhead Storage Unit 

Workrite Straightway w/ adjustable Arm 



s 


5:9.:: 


1 S 


639.00 


s 


218.00 


1 s 


218.00 


s 


909.00 


1 s 


909.00 


s 


596.00 


1 s 


536.00 


s 


855.00 


1 s 


E5£." 


s 


312.00 


1 s 


312.00 



18 



875 Stevenson 
Furnishing Cost Estimate 



Item 

Conference Table 
Bookshelf 
Ergonomic Chair 
Side Chair 



Item Description Unit Cost 

HON Round Table, 42"d, Medium Oak S 495.00 

HON Bookcase, 47" h, black S 161.00 

Eckadams High Back Chair w/ arms, burgundy S 555.00 

HON Guest Arm Chair, Oak/Burgundy S 255.00 

List Price: 



i^age 3 or 4 



Qntv. Cost 

1 $ 495.00 

2 S 322.00 
1 S 555.00 
4 S 1,020.00 

5 5,921.00 



City's Price (40% discount & tax): $ 3,854.57 
Total Cost/Floor 



Supervisor's Office 
Desk 



Keyboard Tray 
Bookshelf 
Ergonomic Chair 
Side Chair 



HON 10700 Radius Edge Series, U-grouping, Medium Oak 

Peninsula Top w/ Edge Panel $ 639.00 

Bridge S 218.00 

Lateral File w/ Credenza $ 909.00 

Lateral File S 596.00 

Workrite Straightway w/ adjustable Arm S 312.00 

HON Bookcase, 47 - h, black $ 1 61 .00 

Eckadams High Back Chair w/ arms, burgundy. S 555.00 

HON Guest Arm Chair, Oak/Burgundy S 255.00 

List Price: 



1 S 639.00 

1 S 218.00 

1 S 909.00 

1 S 596.00 

1 S 312.00 

1 S 161.00 

1 S 555.00 

2 S 510.00 

S 3,900.00 



City's Price (40% discount & tax): S 2,538.90 



Large Conference Room 



Chairs 



HON Stackable Guest Chair, burgundy 
(unit=2 chairs) 



Side Chair HON Exexutive Swivel, burgundy 

Electronic Copyboard Plus Corp. 77"x42' 

Table HON Rectangular Table, 42x96, Medium Oak 



S 294.00 
S 500.00 

S 245.00 

$2,195.00 

S 700.00 



List Price: 



15 S4, 410.00 

8 S 1,960.00 

1 S 2,195.00 

1 $ 700.00 

S 9,265.00 



City's Price (40% discount & tax): S 6,031 .52 



Small Conference Room 

Electronic Copyboard Plus Corp. 77"x42" 



S 2.195.00 



1 S2.195.00 



19 



875 Stevenson 
Furnishing Cost Estimate 



Item 

Side Chair 
Table 



Item Description 

HON Exexutive Swivel, burgundy 

HON Rectangular Table, 42x96, Medium Oak 



Attachment i 

Fage 4 of A 

Unit Cost Qntv. Cost 

S 245.00 8 S 1,960.00 

S 700.00 i S 700.00 

Li^ Pn ce: S 4,855.00 

City's Pnce (40% discount & tax): S 3.160.61 



Reception Area 
Side Chair 



Lesro 2-Seat Sofa, Oak/Burgundy 
Lesro End Table. Medium Oak 



S 472.00 
S 169.00 



2 S 944.00 
1 S 169.00 



List Pnce: S 1,1 13.00 

City's Pnce (40% discount & tax): S 603.80 



20 




Department of Telecommunications and Information Sen - 
City and County of San Francisco 



December 22, 1998 



as 



THROUGH: Edmundo Golchado, Deputy Director 

Ms. Lena Chen 

Project Manager, 

Utilities Engineering Bureau 

Public Utilities Commission 

1155 Market, Street 

San Francisco, CA 94102 

Dear Ms. Chen: 

The following is an estimate of the total cost to move your operation currently located at 1155 
Market, 7th floor to 875 Stevenson, 3rd floor. A detailed breakdown of the costs associated with 
this move is as follows: 

Lucent equipment costs $ 37,13 1 .25 

Network Engineering Consulting 4,000.00 

Estimated labor (wiring/install) 30,500.00 

Estimated parts (wiring) 44,500.00 

Pac Bell Tl installation 1 ,590.00 



Total $117,721.25 

DTIS would require a work order in the amount of $11 6, 13 1.25 sixty days prior to your 
anticipated move to fund equipment costs, network engineering consulting charges, and labor 
and parts for wiring. The Pacific Bell installation charge ($1,590) would be covered by the 
Utilities Engineering Bureau's usage work order. 

If you have any questions, please do not hesitate to call me at 550-2777. 

Sincerely, 

li Soto 
Network Engineering Consultant 

cc: J. DeRouen 
M. Hobson 
P. Arnold 

21 - 



PPR-07-1999 16=29 



CCSF REPL ESTATE DEPT 



City and County of San Francisco 



Attachment 3 

Real Estate Department 

Office ot trie 
Director cf Property 



875 Stevenson, 3 Floor 

Public Utilities Commission 

Tenant Improvement Budget Summary 

Based On Estimates From Hensel Phelps Construction 

As of 3/24/99 



Doors &. Partitions 

Paint & Finishes 

Carpet & Flooring 

Ceilings (Re-work) 

Mill work 

Demolition 

General Conditions 

Mechanical - HVAC 

Fire Protection 

Electrical 

Permits 

Fees 

Indirects (Insurance, Taxes) 

Contingency 

Total 



$67,126 
24,817 

127,048 
20,436 
56,275 
48,386 

103.435 
51,500 
15,400 

176,300 
19,880 
77,350 
12,174 

34409 
5834,^6 



Excludes Architectural & Engineering, Telephone. Data, Furniture and other 



non construction costs. 



ai *- 3H50 WHEAL 

FAX: 552-«2T6^ 



..EST^lSVR\DATA\USER^(^U^^RG^2^gUC 875 Stocas Ti.doc 



S*nFr»nc»ec 94102 



22 



RPR-a7-lSS9 0S:3l 



FUC FINANCE 



Attachment 4 



Post-if Fax Note 7671 


I * 8 4LS . *£»► I 


To ^t>JU^ ^«^w^ 


P- W IUJ 


CaJOKL U;«\<\ 


r ?uc 


Phone* 


!"»"•• H^i. s*.rc 


«=«» 252.- oHU 


r - 



Public Utilities Commission 
Projected Growth (1998-99 to 2000-01) 
11=5 Market Street 



Unit 


New 




Positions 


UE3 (contract admin.} 
UE3 (construction mat) 
UE3 (project mgt) 
Heteh Hetchy 
Energy Conservation 
Finance 


3 
10 
23 
8 
5 
1- 


Accounting 

Land Management 

Management Information 

Personnel 


3 
1 
3 
3 


Human Rights Commission 


3 



Total 



66 



4/7/999:37 AM 



23 



newpcs.xls 
TOTfiL P. 01 



APR-15-1999 11:25 



PUC FINANCE 



Poaf-rt* Fax Note 



7f 



Attachment 5 
Pa^e I or 2 



REVISED COST ESTIMATE 
Furniture Purchase for 875 Stevenson 

Estimated furniture needed for staff through first year 

Bureau Manager 

Section Manger 

Sr. Superivsor 

MIS Sr. Supenvsion 

Professional & Technical Staff 

Clerical 

Conference Room 

Training 



To 



M^ N% 



CoJDmnL 



l\tVr\ 



xisuhn 



hi- om,' 



Hie. 



M91- ^-LTr 



Qnty. 


Unit Cost 


Total Cost 


1 


$3,639.06 


$ 3.639.06 


4 


$2,980.49 


$ 11.921.96 


3 


$1.99229 


$ 5,976.87 


1 


S 2.993.34 


$ 2,993.34 


68 


$4,233.24 


$287,B60.32 


7 


$4,233.24 


5 29,632.68 


4 


51,833.80 


$ 7,335.20 


1 


S 893.00 


5 899.00 


Sub- total: 




$350258.43 


Sales tax: 




$ 29,771.97 


Furniture: 




$ 380.030.40 



Estimation of Reusable Furnishings from 875 Stevenson & 
1155 Market Street 



F-le Cabinets 


65 


Bookshelves 


65 


Ergonomic Chairs 


57 


Workrite Keyboard Trays 


3 


Complete Set of Executive 


1 


Fum (Sr. Supervisor) 






Sub-total: 




Sales tax value: 



S 314.36 $ 20.433.40 

5 87.00 $ 5,655.00 

S 211.38 $ 12,048.66 

$ 170.50 $ 511.50 

$1,99229 $ 1.99229 



Estimated Savings by Re-use: 
Revised Cost Estimate: 



5 40.540.85 
$ 3,454.47 

$ 44,095.32 

$ 335,935.07 



Previous Cost Estimate: 

Reduction from Previous Estimate: 
Percent Reduction: 



$463,221.00 

$127,225.93 
27% 



24 



04/15/1999 14:51 4155541886 LE3 PAGE 02 

Attachment 5 
Page 2 of 2 



REVISED COST ESTIMATE 
Save Carpet Wherever Possible 



Original Contractor's Cost Estimate 



Demolition of Existing Carpet $ 8,381.00 

New Carpet $ 1 20,1 50.00 

Base S 6.258.00 



Estimated Original Cost S 134,789.00 

Revised Estimate - Installation of new carpet where no carpet currently exists 
and patching existing in areas of Demo. 

Patch at Demolition $ 2,220.00 

New Carpet $ 27.914.00 

Base $ 2.000.00 



Estimated Revised Cost $ 32,134.00 

Reduction from Previous Estimate: $ 102,555.00 

Percent Reduction: 76% 



25 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Item 2 - 99-0604 

Department: 

Item: 



Grant Amount: 
Grant Period: 

Source of Funds: 

Project: 

Description: 



Mayor's Office of Community Development 

Resolution authorizing the Mayor's Office of Community 
Development to accept and expend, up to $25,000 in grant 
funds from the California Waste Management Board for 
the Tire Recycling Grant Program, and waiving indirect 
costs. 

Up to $25,000 

June 1, 1999 through April 1, 2001 (approximately 22 
months) 

California Integrated Waste Management Board 

Tire Recycling Grant Program 

State Assembly Bill 1843 provides grants to local 
governments for the purpose of diverting tires from 
landfill disposal and for recycling used tires by fostering 
new business enterprises for such purposes. The 
California Integrated Waste Management Board has been 
delegated the responsibility for the administration of the 
program. 

The proposed grant funds would be used by the San 
Francisco Conservation Corps (SFCC), a non-profit 
organization, for the Tire Recycling Grant Program. 
Under this program, the SFCC would purchase and 
install rubber matting, made from recycled tires, at five 
playgrounds in the City in order to make these 
playgrounds safer. Mr. Jon Pon of the Mayor's Office of 
Community Development (MOCD) advises that the five 
playgrounds have not yet been identified, but are located 
on property owned either by a non-profit organization or 
the San Francisco Housing Authority. 

The installation of rubber matting by the SFCC would be 
part of their ongoing project to improve various 
playgrounds throughout the City. As part of MOCD's 
budget for the expenditure of the City's 1999 Community 
Development Block Grant (CDBG) Entitlement from the 
BOARD OF SUPERVISORS 
BUDGET ANALYST 



26 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Budget: 



U.S. Department of Housing and Urban Development, the 
MOCD allocated $1,153,715 to the SFCC to accomplish 
public space improvements and to provide jobs and 
education for the City's youth. The SFCC is a non-profit 
organization dedicated to the development and 
improvement of the City's youth (18 to 24 years of age) 
and its public land. The SFCC's 1999 CDBG allocation of 
$1,153,715 funds 16 public space improvement projects 
for public agency or non-profit sponsors. Of the 16 public 
space improvement projects, 10 projects involve installing 
rubber matting, made of recycled tires, at 10 playgrounds 
located in the City. According to Mr. Jon Pon of the 
MOCD, with the proposed grant funds, the SFCC would 
purchase and install rubber matting at five of those 10 
playgrounds. 

According to Mr. Pon, the total estimated cost for the 
SFCC to purchase and install rubber matting made from 
recycled tires at the five playgrounds is $50,000. 
Therefore, this project would require an additional 
$25,000 (total estimated cost of $50,000 less the subject 
grant funds of $25,000). Mr. Pon advises that $25,000 is 
available from previously allocated funds to the SFCC 
under the Citv's 1999 CDBG Program. 



The budget of $50,000 to support this project is as follows: 

Five playground sites 

averaging 1,250 square feet of rubber matting 

at $8.00 per square foot $50,000 

Indirect Costs: The California Integrated Waste Management Board does 

not allow the inclusion of indirect costs under this grant 
program. As such, the MOCD has requested that indirect 
costs be waived. 



Required Match: 



$25,000 in matching funds previously allocated to the 
SFCC in the Citv's 1999 CDBG Program. 



Comments: 



1. The Attachment to this report is the Grant Application 
Information Form as prepared by the MOCD. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



27 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



2. Tbe MOCD has prepared a Disability Access Checklist, 
which is on file with the Clerk of the Board of 
Supervisors. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

28 



Attachment 
File Number: i'age 1 of 2 

Grant Application Information Form 

A document required to accompany a proposed resolution 
Authorizing a Department to Accept & Expend Grant Funds 

To: The Board of Supervisors 
Attn. Clerk of the Board 

The following describes the grant referred to in the accompanying resolution: 

1. Department: MAYOR'S OFFTCF OF COMMUNITY FlFVFI OPMFNT 

2. Contact Person: JON PON Telephone: 252-5152 

3. Project Tide: TIRE RECYCLING GRANT PROGRAM 

4. Grant Source Agency: CALIF, INTEGRATED WASTE MANAGEMENT BOARD 

5. Type of Funds: Federal Federal-State (Pass-Through) _J(State Local Private 

6. Proposed (New / Continuation) Grant Project Summary: 

Installation of rubber matting made from recycled 
tires in playgrounds located in the clty and 
County of San Francisco. 

7. Amount of Grant Funding Applied for: IIP TO S?5.000 

8. Maximum Funding Amount Available: $25 , 000 



9. Required Matching Funds? Yes: X_ No: / Cash or In-kind 9 



If yes, list dollar amount and identify source of Matching Funds in Department Budget: 

$25,000 in Community Dfvfi opmfnt Ri nr« Grant cnMnc 

10. Number of new positions created and funded: N/A 



1 1 . If new positions are created, explain the disposition of employees once the grant ends? 
N/A 



29 



Attachment 
Page 2 of 2 



12. Are indirect costs eligible costs for this grant? Yes: No: %_ 

If yes, please identify the amount of S in indirect costs? 



13. Amount to be spent on contractual services: $?S , 000 



14. a.) Will contractual services be put out to bid? YES 



b). If so, will contract services help to further the goals of the department's MBE/WBE 
requirements? 



1 5. Is this likely to be a one-time or ongoing request for contracting out ? ONE TIME 

16. Term of Grant: Start-Date: JUNE 1, 1999 End-Date: APRIL 1, 2001 

17. Date Department Notified of Available Funds: OCTOBER 1998 

18. Grant Application Due Date: DECEMBER 4, 1998 

19. Grant Funding Guidelines and Options (selected from RFP, grant announcement or 

appropriations legislation): 



20. Department Head Approval: PAMELA H . DAVID, Dl RECTOR 




(Signature) 



30 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Item 3 - 99-0609 
Department: 

Item: 

Amount: 
Source of Funds: 
Description: 



Budget: 



Public Utilities Commission (PUC) 
Department of Public Works (DPW) 

Resolution approving the expenditure of funds for the 
emergency work to replace the structurally inadequate 
sewer on Anza Street between 7 th and 8 th Avenues. 

$194,291 

FY 1998-99 PUC Repair and Replacement Fund 

The Public Utilities Commission (PUC) advises that on 
July 21, 1998, the sewer located on Anza Street between 
7 th and 8 th Avenues failed, and immediate replacement 
was required in order to protect the health, welfare, and 
property of the citizens of San Francisco. The PUC 
declared an emergency on July 23, 1998. In accordance 
with Section 6.30 of the Administrative Code, the PUC 
initiated expedited contract procedures, and awarded a 
contract to J.M.B. Construction in the amount of 
$158,641. 

The total actual project cost "was $194,291, including 
$158,641 in actual construction costs (or $2,829 less than 
the quotation amount, see Comment No. 2) and $35,650 
for DPW engineering and construction management costs. 

A summary of this budget is as follows: 

Construction Contract $158,641 

DPW Bureau of Engineering 20,650 

DPW Bureau of Construction Management 15.000 



Total 



$194,291 



Attachment I, provided by DPW, contains additional 
budget details to support this $194,291. Attachment II, 
also provided by DPW, details the DPW Bureau of 
Engineering and Bureau of Construction Management 
costs. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

31 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Comments: 



1. Invitations for proposals were faxed to 11 contractors 
on July 19, 1998. According to Mr. P.T. Law of DPW, 
J.M.B. Construction, which submitted a bid in the 
amount of $161,470 on July 31, 1998, was the only 
qualified contractor. Mr. Law states that J.M.B. 
Construction was awarded the contract in the amount of 
$161,470. 

2. PUC reports that although the contract was awarded 
in the amount of $161,470, the final contract cost, after 
adjustment for actual quantities used during 
construction, was $158,641 or $2,829 less than the 
contract amount of $161,470. 

3. PUC reports that the replacement of the damaged 
sewer began on August 10, 1998 and was completed on 
October 16, 1998. 

4. Mr. Law advises that due to various delays in 
receiving expenditure documentation from the contractor, 
the PUC is requesting approval of this resolution 
approximately six months after the construction work was 
completed. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

32 




AGENDA 



Attachment I 
rage i or 3 



Post-lf* brand fax transmittal memo 7671 • of pag* ► £? 



*<£***. r^gy/» 



-£ , 



D«pc 

IS* 



J&2-C><t6/ 



P~7£+«J 



^£*z£MJL 



DEPARTMENT Utilities Engineering Bureau 



AGENDA NO. 



MEETING DATE March 23, 1999 



SUMMARY OF PROPOSED ACTION: 

Ratifying the Declaration of Emergency made by the President of the Public Utilities Commission for Clean Water 
Program Contract No. CW-201E, "Anza Street Emergency Sewer Replacement," Requesting the Board of 
Supervisors to Approve expenditure of funds to replace the structurally inadequate brick sewer on Anza Street 
from 7* Avenue to 8* Avenue. 



DESCRBPTION OF PROPOSED ACTION: 

The wodc performed under this Emergency consisted of performing traffic routing work and trench support work: 
constructing 268 linear feet of 42-inch diameter reinforced concrete pipe (RCP) on crushed rock bedding; 
constructing concrete manholes, 10-inch diameter VCP culverts, and 6 or 8-inch diameter side sewer connections; 
videotaping existing active side sewers; repairing and/or replacing existing defective active side sewers; removing 
existing sewers and sewer structures; replacing frame and cover of existing catchbasin; plugging and filling existing 
sewer with Slurry grout; cleaning existing catchbasins; videotaping newly constructed main sewers; supporting, 
working around and protecting certain Water Department, Fire Department and other utility agency and company 
facilities in conjunction with the work under this contract, and all related and incidental work on Anza Street from 
7* Avenue- to 8* Avenue. This work included all planning, design, and construction support services (under Job 
Older No. 162 IN), 




rnance Steven Carmichael 



Michael £. Qu*n 






Roaain* A. Boldridge 






33 



Attach ment I 
FagfT 



TTT 



Page 2 PUC Calendar Item Number: 



Department: Utilities Engineering Bureau 



Project: CW-201E. Anza Sl Emergency Sewer Replacemem 



The invitations for proposals were faxed to eleven (1 1) MBEAVBE contractors on July 29. 1993. 
One (1) Quotation was received on July 31. 1998 as follows: 



Finn 



Quote Quote Adjusted Rank 
Amount Preference AmounK') 



1. J.M.B. Construction Inc. 
(LBE/MBE) 
San Francisco. CA 



S 16 1.470.00 10% 



S145.323.00 1 



(*) For comparison of quotes after application of business enterprise preferences. 

Work is of lump sum and unit bid item type. 

The Engineer's Estimate for this contract was SI 50,600.00. The original contract as awarded to J.M.B. 
Construction was for $161,470.00. The final contract cost after adjustment for actual quantities used 
during construction is $ 158,64 1 .00. 

Therefore, the cost of this project is estimated to be SI 94. 29 1.00: 

Bureau of Engineering (Planning, Design, and Construction Support) S 20,650.00 

Bureau of Construction Management (Construction Inspection) S 15,000.00 

Final Constr uction Contract Cost S158.641.00 



Total Project Cost 



$194,291.00 



This project is pan of the Clean Water Program's Repair and Replacement Program. Funds are available 
j from the R&R Fund (Fund 5C/CPF/R&R, FAMIS Project No. CENRNRR989, Job Order No. 1 62 IN). 

; AffirwjYfl Assign 

Because this was an emergency contract, HRC subcontracting goals were not established by the HRC 
Contract Compliance Officer assigned to monitor the Clean Water Repair and Replacement program. 



34 



.Vag.e J _o±._3. 



Page 3 PUC Calendar Item Number: 



Department: Utilities Engineering Bureau 



Project CW-20IE, Anza St Emergency Sewer Replacement 



J.M.B. Construction began the work on August 10, 1998. All work was specified to be completed on or 
before September 27, 1998. All work was actually completed on October 16. 199S. A time extension for 
nineteen (19) calendar days was approved to cover a delay in manufacturing the 42-inch reinforced concrete 
pipe (RCP). 



CONTEXT OF THIS ACTION: 

On July 21, 1998 PUC Sewer Operations notified the Hydraulic Engineering Section of the Bureau of 
Engineering that the existing 2x3 brick main sewer on Anza Street from 7 th Avenue to 8* Avenue had 
severe sags in the line and missing grout which had caused infiltration of sand and the street to cave-in. 
Sewer Operations further requested the Bureau of Engineering to prepare an Emergency Contract to replace 
this brick sewer. 

Letter* informing the UEB Manager, the PUC President, the Mayor, the Controller, and the Board of 
Supervisors of the emergency situation were sent on July 23, 1998. The Declaration of Emergency has been 
signed by the President of the PUC. 

The Bureau of Engineering prepared the plans and specifications for this emergency contract. 



Atf rhmants: 

1. Resolution 

2. Draft Board of Supervisors Resolution 

Contact Person: Mr. Norman Chan Phone: 554-8355 



cc: B. Lun C.Tang M.Williams J. To 

C Jacob© F.Bongolan P. Law P.Scott 



35 



Attachment II 



Cost Breakdown for ( J.O. #1621N, Contract #CW-201 E) 
Anza Street Emergency Sewer Replacement 



Buroau of Engineering 



Classification 


Title 




Rate 


Hours 




Cost 


5504 


Protect Manager II 


S 


92 


10 


S 


920 


5206 


Associate Civil Engineer 


s 


75 


41 


s 


3,075 


5202 


Junior Civil Engineer 


s 


50 


98 


s 


4.900 


5366 


Civil Engineering Associate II 


s 


60 


135 


s 


8,100 


5381 


Engineering Student Trainee II 


$ 


33 


51 


$ 


1.683 


1426 


Secretary 


$ 


43 


46 


s 


1.978 












$ 


20.656 










Rounded: 


$ 


20,650 



Ctaaad 



cation 



Bureau of Construction Management 



Title 



Rate 



Hours 



C08t 



5210 


Senior Civil Engineer 


S 


100 


10 


$ 


1,000 


5208 


CMI Engineer 


S 


80 


11 


S 


880 


5204 


Assistant Civil Engineer 


s 


59 


112 


s 


6.608 


6318 


Construction Inspector 


s 


74 


88 


s 


6.512 












$ 


15,000 










Rounded: 


s 


15,000 



36 






Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Item 4 -99-0610 

Department: 

Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

Square Footage: 

Term of Lease: 



Annual Rent Payable 
by CalStar, Inc. to 
Airport: 



Airport Commission 

Resolution authorizing a new International Terminal 
newsstand lease between CalStar Retail, Inc., a Small 
Business Enterprise set-aside, and the City and County of 
San Francisco, acting by and through its Airport 
Commission. 

New International Terminal of the Airport 

Concession space for the purpose of selling newspapers, 
magazines, and various other items. (See Description 
below.) 

City and County of San Francisco by and through the 
Airport Commission. 

CalStar Retail, Inc. (CalStar) 

2,340 square feet at one location near the p re-security 
Boarding Area A, in the new International Terminal. 

The proposed concession lease would commence in May of 
2000 to coincide with the date on which the new 
International Terminal will open to the public. The lease 
would be for a period of five years, terminating in 2005. 



Beginning from the first year of the lease, and through 
the duration of the five-year lease period, the annual rent 
payable by CalStar to the Airport is the greater of either 
the Minimum Annual Guarantee of $632,823, subject to 
the Consumer Price Index (CPI) annual adjustment, or a 
percentage of gross receipts, as follows: 



Gross Receipts 



Percentage of Gross Receipts 



Up to and including $500,000 12% 

$500,000.01 to and including $1,000,000 14% 
Over $1,000,000 16% 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

37 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Utilities and 
Janitorial Services: 



Right of Renewal: 

Tenant 
Improvements: 



The Lessor will pay for the costs of all utilities and 
janitorial services. 

None. 



According to Mr. Dave Dunn of the Airport, CalStar 
would be required to invest a minimum of $351,000 based 
on $150 per square foot to renovate the subject leased 
space. Mr. Dunn states that the tenant improvements 
would begin in early 2000. 



Description of 
Proposed Lease: 



Comments: 



On September 15, 1998, the Airport Commission 
authorized the Airport to receive bids for three Small 
Business Enterprise set-aside leases in the new 
International Terminal (Resolution No. 98-0231). The 
proposed lease is one of these set-aside leases. 
Subsequently, on March 16, 1999, the Airport 
Commission adopted a resolution (Resolution No. 99- 
0059) awarding the lease to CalStar for retail concessions 
in the new International Terminal. 

Under the proposed lease, CalStar would operate one 
newsstand near the pre-security Boarding Area A in the 
new International Terminal. CalStar would sell the 
following: local, daily, and out-of-town newspapers; 
magazines and other periodicals; paperback and hardback 
books; health and beauty aids; film and photography 
accessories; candy; and non-prescription drugs. 

1. The Minimum Annual Guarantee of $632,823 is 
$317,823 more than the Airport's Minimum Required 
Annual Guarantee of $315,000, which was the required 
Minimum Annual Guarantee bid amount contained in the 
Airport's Invitation to Bid. The proposed lease with 
CalStar is noted as Unit No. 8 in the Attachment provided 
by Ms. Teresa Rivor of the Airport. The Attachment 
contains the basis for the calculation of the Minimum 
Required Annual Guarantee Bid. Ms. Rivor states that 
the basis of the $315,000 Minimum Required Annual 
Guarantee Bid, as set by the Airport, was determined by 
calculating 15 percent of the anticipated annual gross 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

38 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



revenues of $2,106,900, which is $316,035, and rounding 
down to $315,000. In an April 15, 1999 memorandum to 
the Budget Analyst from Mr. Bob Rhoades of the Airport, 
Mr. Rhoades explains that the Airport used 15 percent to 
calculate the Minimum Required Annual Guarantee Bid 
because "...15 percent of anticipated annual gross 
revenues is considered an industry standard." The 
anticipated gross revenue is formulated by projecting the 
number of travelers and spending per passenger. 

2. There were two other bidders for the proposed lease. 
Mr. Dunn of the Airport reports that the Airport 
Commission awarded the subject lease to CalStar based 
on the determination that CalStar submitted the highest 
responsive and qualified Minimum Annual Guarantee 
Bid. Bids were received from the following three firms: 

Bidder Min. Annual Guarantee 

Warren News & Gift, Inc. $575,001.01 

CalStar Retail, Inc. $632,823 

The Benjamin Co. $669,251 

3. According to Ms. Rivor, The Benjamin Company, 
which submitted the highest Minimum Annual Guarantee 
Bid of $669,251, was not selected because it did not meet 
the Small Business Enterprise (SBE)/Disadvantaged 
Business Enterprise (DBE) requirement set forth in the 
bid documents. The Benjamin Company does not meet 
the definition of a SBE/DBE because it exceeds $30 
million in annual revenue. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

39 



l|ii s 

H|J 

£| 5 ? 
ilfi 

ill* 

u: : 

*"; " 1 

3 * • 2 

sSES 

If If 

fill 
Ifll 

<-» • • • 

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-^ a c 

;!!• 

3. | £ 5" 

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j 

IB 




40 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 5-99-0611 



Department: 
Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

Square Footage: 

Term of Lease: 



Annual Rent 
Payable by 
Discovery Channel 
Stores, Inc. to 
Airport: 



Airport Commission 

Resolution authorizing the new International Terminal 
Nature Theme Store lease between Discovery Channel 
Stores, Inc., and the City and County of San Francisco, 
acting by and through its Airport Commission. 

New International Terminal of the Airport 

Concession space for the purpose of selling nature-related 
gifts, souvenirs, and specialty items. (See Description 
below.) 

City and County of San Francisco by and through the 
Airport Commission. 

Discovery Channel Stores, Inc. (Discovery) 

2,238 square feet in total at one location in the Central 
Concourse of the Main Terminal in the new International 
Terminal. 

The proposed concession lease would commence in May of 
2000 to coincide with the date on which the new- 
International Terminal will open to the public. The lease 
would be for a period of five years, terminating in 2005. 



Beginning from the first year of the lease, and through 
the duration of the five-year lease period, the annual rent 
payable by Discovery Channel Stores, Inc. to the Airport 
is the greater of either the Minimum Annual Guarantee 
of $260,000, subject to the Consumer Price Index (CPI) 
annual adjustment, or a percentage of gross receipts, as 
follows: 



Gross Receipts 



Percentage of Gross Receipts 



Up to and including $1,000,000 
$1,000,000.01 to and including $2,000,000 
Over $2,000,000 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



12% 
14% 
16% 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Utilities and 
Janitorial Services: 



Right of Renewal: 

Tenant 
Improvements: 



The Lessor will pay for the costs of all utilities and 
janitorial services. 

None. 



According to Mr. Dave Dunn of the Airport, Discovery 
would be required to invest a minimum of $335,700 based 
on $150 per square foot to renovate the subject leased 
space. Mr. Dunn states that the tenant improvements 
would begin in early 2000. 



Description of 
Proposed Lease: 



Comments: 



On October 27, 1998, the Airport Commission authorized 
the Airport to receive bids for the new International 
Terminal Nature Theme Store lease (Resolution No. 98- 
0271). Subsequently, on February 2, 1999, the Airport 
Commission adopted a resolution (Resolution No. 99- 
0022) awarding this Nature Theme Store lease to 
Discovery Channel Stores, Inc. for retail concessions in 
the new International Terminal. 

Under the proposed lease. Discovery would operate one 
shop located at Main Terminal - Central Concourse in the 
new International Terminal. The store would sell nature- 
related items such as books and other educational 
materials, toys, clothing, hats, and specialty items such as 
telescopes. The Nature Theme Store lease is one of six 
theme stores at the Airport. Other theme stores include a 
museum shop and a golf shop. 

1. The Minimum Annual Guarantee of $260,000 is 
$46,000 more than the Airport's Minimum Required 
Annual Guarantee of $214,000, which was the required 
Minimum Annual Guarantee bid amount contained in the 
Airport's Invitation to Bid. The proposed lease with 
Discovery is noted as Unit No. 1 in the Attachment 
provided by Ms. Teresa Rivor of the Airport. The 
Attachment contains the basis for the calculation of the 
Minimum Required Annual Guarantee Bid. Ms Rivor 
states that the basis of the $214,000 Minimum Required 
Annual Guarantee Bid, as set by the Airport, was 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

42 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



determined by calculating 12 percent of tbe anticipated 
annual gross revenues of $1,790,400, whicb is $214,848, 
and rounding down to $214,000. In an April 15, 1999 
memorandum to tbe Budget Analyst from Mr. Bob 
Rboades of tbe Airport, Mr. Rboades explains tbat tbe 
Airport normally uses 15 percent to calculate tbe 
Minimum Required Annual Guarantee Bid because "...15 
percent of anticipated annual gross revenues is considered 
an industry standard." However, for tbe proposed Nature 
Tbeme Store lease, the Airport used 12 percent to 
calculate tbe Minimum Required Annual Guarantee. Mr. 
Rboades states tbat the change "...was in response to the 
comments made at the pre-bid conference held on August 
25, 1998. The Airport, after further research and review, 
lowered the minimum annual guarantee to $214,000, 
which is 12 percent of the estimated gross revenues at the 
bid stage. The change was made to ensure that we 
remain competitive with commercial shopping malls and 
encourage prospective bidders to participate in this 
concession opportunity." The anticipated gross revenue is 
formulated by projecting the number of travelers and 
spending per passenger. 

2. There were two other bidders for the proposed lease. 
Ms. Rivor of the Airport reports that the Airport 
Commission awarded the subject lease to Discovery based 
on the determination that Discovery submitted the 
highest responsive and qualified Minimum Annual 
Guarantee Bid. Bids were received from the following 
three firms: 

Bidder Min. Annual Guarantee 
Discovery $260,000 

Host International 220,000 

CalStar 216,614 



Recommendation: Approve proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

43 



ATTACHMENT 



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44 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 6 - 99-0612 



Department: 
Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

Square Footage: 

Term of Lease: 



Annual Rent 
Payable by 
Golf on the 
Avenue Inc. 
to Airport: 



Airport Commission 

Resolution authorizing the new International Terminal 
Golf Shop lease between Golf on the Avenue, Inc. and the 
City and County of San Francisco, acting by and through 
its Airport Commission. 

New International Terminal of the Airport 

Concession space for the purpose of selling golf-related 
gifts, souvenirs and specialty items. (See Description 
below.) 

City and County of San Francisco by and through the 
Airport Commission. 

Golf on the Avenue, Inc. 

1,895 square feet in total at one location by post-security 
Boarding Area A in the new International Terminal. 

The proposed concession lease would commence in May of 
2000 to coincide with the date on which the new 
International Terminal will open to the public. The lease 
would be for a period of five years, terminating in 2005. 



Beginning from the first year of the lease, and through 
the duration of the five-year lease period, the annual rent 
payable by Golf on the Avenue, Inc. to the Airport is the 
greater of either the Minimum Annual Guarantee of 
$225,100, subject to the Consumer Price Index (CPI) 
annual adjustment, or a percentage of gross receipts, as 
follows: 



Gross Receipts 



Percentage of Gross Receipts 



Up to and including $500,000 12% 

$500,000.01 to and including $1,000,000 14% 
Over $1,000,000 16% 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

45 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Utilities and 
Janitorial Services: 



Right of Renewal: 

Tenant 
Improvements: 



Description of 
Proposed Lease: 



Comments: 



The Lessor will pay for the costs of all utilities and 
janitorial services. 

None. 



According to Mr. Dave Dunn of the Airport, Golf on the 
Avenue would be required to invest a minimum of 
$284,250 based on $150 per square foot to renovate the 
subject leased space. Mr. Dunn states that the tenant 
improvements would begin in early 2000. 



On September 15, 1998, the Airport Commission 
authorized the Airport to receive bids for the new 
International Terminal Golf Theme Store lease 
(Resolution No. 98-0233). Subsequently, on December 15, 
1998, the Airport Commission adopted a resolution 
(Resolution No. 99-0022) awarding this Golf Theme Store 
lease to Golf on the Avenue, Inc. for retail concessions in 
the new International Terminal. 

Under the proposed lease. Golf on the Avenue, Inc. would 
operate one shop located by post-security Boarding Area A 
in the new International Terminal. The shop would sell 
golf-related clothing, books, and equipment. The Golf 
Theme Store lease is one of six theme stores at the 
Airport. Other theme stores include a museum shop and 
a nature shop. 

1. The Minimum Annual Guarantee of $225,100 is $100 
more than the Airport's Minimum Required Annual 
Guarantee of $225,000, which was the required Minimum 
Annual Guarantee bid amount contained in the Airport's 
Invitation to Bid. The proposed lease with Golf on the 
Avenue is noted as Unit No. 4 in the Attachment provided 
by Ms. Teresa Rivor of the Airport. The Attachment 
contains the basis for the calculation of the Minimum 
Required Annual Guarantee Bid. Ms. Rivor states that 
the basis of the $225,000 Minimum Required Annual 
Guarantee Bid, as set by the Airport, was determined by 
calculating 15 percent of the anticipated annual gross 
revenues of $1,514,400, which is $227,160, and rounding 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

46 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



down to $225,000. In an April 15, 1999 memorandum to 
tbe Budget Analyst from Mr. Bob Rboades of the Airport, 
Mr. Rboades explains tbat tbe Airport used 15 percent to 
calculate tbe Minim um Required Annual Guarantee Bid 
because "...15 percent of anticipated annual gross 
revenues is considered an industry standard." Tbe 
anticipated gross revenue is formulated by projecting tbe 
number of travelers and spending per passenger. 

2. There were no otber bidders for tbe proposed lease. 
According to Ms. Rivor, while there were four other firms 
that expressed an interest in tbe Golf Theme Store lease, 
no other companies submitted a bid. Ms. Rivor reports 
tbat Golf on the Avenue submitted a responsive and 
qualified Minimum Annual Guarantee Bid. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

47 



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48 



Memo to Finance and Labor Committee 

April 21, 1999 Audit and Efficiency Committee Meeting 

Item 7 - File 99-0673 



Department: 
Item: 



Location: 

Purpose of 
Lease Agreement: 



Lessor: 
Lessee: 

No. of Sq. Ft.: 



Rent per Month: 



Airport 

Resolution approving lease agreement for office/warehouse 
space at 245 South Spruce Avenue, South San Francisco, 
between South City Industrial Company, LLC, as lessor, and 
the City and County of San Francisco, acting by and through 
its Airport Commission, as lessee. 

245 South Spruce Avenue, South San Francisco 



This new lease would provide additional off-Airport space in 
the City of South San Francisco to accommodate the (1) 
expansion of office staff and (2) the storage of Facilities and 
Operations Management documents and attic stock 1 related 
to the new International Terminal building. Attachment I 
provided by the Airport explains the purpose of the lease, 
how many employees will occupy the space, the amount of 
space per square feet per employee, and the planned re-use of 
vacated space if the subject lease is approved. 

South City Industrial Company, LLC 

City and County of San Francisco acting through the Airport 
Commission 

Approximately 562,936 sq. ft. in total 

Ground Floor Office Space: approximately 45,674 sq. ft. 
Mezzanine Office Space: approximately 3,331 sq. ft. 

Warehouse Space: approximately 513,931 sq. ft. 

Attachment II provided by the Airport contains the number 
of square feet and the monthly cost per square foot for the (a) 
the Ground Floor Office Space, (b) the Mezzanine Office 
Space, and (c) the Warehouse Space, as well as total monthly 
and annual rental and operating expenses. 

$434,693.75 (excluding utilities) or $0.77 per square foot. 
($434,693.75 divided by 562,936 square feet) 



1 "Attic stock" refers to overages of various buildings materials associated with the construction of 
new buildings (e.g., ceiling tiles, light fixture covers, carpet). 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

49 



Memo to Finance and Labor Committee 

April 21, 1999 Audit and Efficiency Committee Meeting 



Annual Rent and 
Operating Costs: 



Term of Lease: 
Right of Renewal: 

Source of Funds: 
Description: 



$5,216,325 rent (excluding utilities) as described in 
Attachment II. Estimated operating costs would total 
$959,752 (including utilities). Total annual rent and 
operating costs would therefore be $6,176,077. 

May 1, 1999 through April 30, 2009. 

The Airport would have two five-year options to extend the 
lease. 

Costs associated with this proposed lease would be budgeted 
in the Airport's general operating fund. Costs for May and 
June of 1999 would be absorbed by the Airport's FY 1998 - 
1999 existing budget. 

As stated in an April 1, 1999 memorandum from the Airport 
Director to the Airport Commission, the Airport requires 
additional off-Airport office and warehouse space to 
accommodate the following: 

1. Additions to Human Resources Staff . According to Mr. 
Gary Franzella, Assistant Deputy Director, the Airport 
intends to increase its Human Resources Division by 27 
FTEs to facilitate the recruitment and selection of 
approximately 350 additional FTEs who will be hired to 
support the operations and maintenance of the new 
International Terminal building. The 27 new Human 
Resources FTEs would be housed in the subject leased 
facility in addition to 30 existing FTEs currently located 
at the Airport who would be relocated to the subject 
leased facility. According to Mr. Franzella, all the above- 
referenced 27 new FTES are included in the Airport's FY 

1998 -1999 budget, but have not yet been hired. 

2. Creation of the Airfield Development Team . The subject 
off-Airport facility would also house approximately 60 
new employees and consultants included in the FY 1998 - 

1999 budget, but not yet hired, for a newly established 
Airfield Development Team. This Airfield Development 
Team will be responsible for the planning and analysis 
associated with a potential new runway for the Airport. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

50 



Memo to Finance and Labor Committee 

April 21, 1999 Audit and Efficiency Committee Meeting 



3. Expansion of Facilities, Operations and Maintenance 
(FOM) Shops . As explained in Attachment I, additional 
maintenance shop facilities will be required to support the 
additional 2.5 million square feet of new terminal space 
associated with the Master Plan Expansion Project. The 
FOM shops would house 145 existing employees. 

According to Mr. Franzella, the proposed lease would relocate 
some Airport operations and expand Airport office and 
warehouse space as shown in the table below: 



Office space 










Proposed 






Current 




Sq. Ft. per 




Current 


Total Sq. 




employee 


Purpose or 


Total Sq. 


Ft. per 


Proposed Sq. 


per 


function 


Ft. 


employee * 


Ft. per lease 


lease** 


Human Resources 


2,900 


96 sq. ft. per 


13,656 


240 sq. ft. 


(hiring & exam 




employee 


(excludes exam 


per 


group, training) 






and interview 
space) 


employee 


General 


1,753 


146 sq. ft. 


6,400 


376 sq. ft. 


Administration 




per 
employee 




per 
employee 


Airfield 


N/A 


N/A 


17,283 


288 sq. ft. 


Development Team 






(excludes 
project "war 
room" space) 


per 
employee 



Based on current employee counts of 30 in the Human Resources 

Group, 12 in the General Administration Group, and in the Airfield 

Development Team. 

' Based on projected employee counts of 57 in the Human Resources 

Group, 17 in the General Administration Group, and 60 in the 

Airfield Development Team. 



Warehouse Space 


Purpose/function 


Current 
Sq. Ft. 


Sq. Ft. per 
proposed lease 


FOM* at Habor Way 


25,000 


25,000 


FOM at Airport 


153,431 


291.682 


Attic Storage 


N/A 


110,000 


Custodial Supplies 


30,000 


65.000 


Current sub-tenants in 
subject lease facility 


N/A 


22,249 


TOTAL 


208,431 


513,931 



Facilities, Operations and Maintenance 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

51 



Memo to Finance and Labor Committee 

April 21, 1999 Audit and Efficiency Committee Meeting 



Attachment III, provided by the Airport, indicates how the 
subject lease agreement would allow the Airport to optimize 
additional revenue potential by moving some operations 
currently located at the Airport to an off-site location 
thereby making premium on-Airport space available for 
rental opportunities for organizations who provide various 
aviation-related services (e.g., cargo handling, equipment 
repair). Mr. Franzella explains that the Airport could 
potentially realize $3,454,051 in new rental revenue as 
follows: 



Space to be 
vacated 


Square Feet 


Projected Rental 
Rates 


Projected 
Revenue 


FOM Warehouse 
Space 


153,431 sq. ft. 


$21.00/sq. ft. 
($1.75/sq. ft. per month) 


$3,222,051 


HR Office Space 


2,900 sq. ft. 


$80.00/sq. ft. 
($6.67/sq. ft. per month) 


$232,000 


TOTAL 






$3,454,051 



This new revenue would offset the proposed lease's total 
annual rental and operating costs of $6,176,077 by 
$3,454,051 per year, reducing the potential net cost increase 
of the proposed lease to $2,722,026. 2 

Attachment rV, provided by the Airport, summarizes the 
Airport's evaluation of alternatives in relation to 
consolidating Airport operations and meeting projected 
spaces needs. 



Comments: 



1. Mr. Charles Dunn from the Department of Real Estate 
advises that the proposed rent represents the fair market 
value of the property. 



2. As stated previously, 27 new Human Resources FTEs 
were approved in the FY 1998-1999 budget and will be hired 



2 The estimated $3,245,051 in new revenue does not include potential additional rent revenue from 
the approximate 25,000 sq. ft. Habor Way facility that would be vacated per the proposed lease. The 
Airport currently uses this facility to store FOM documents in addition to those stored at the Airport. 
The lease on this facility expires on June 30, 2002. According to Mr. Franzella, the Airport is 
investigating either terminating the lease or establishing a sublease agreement. Mr. Franzelli 
explains that there is a high-demand for this type of space by airport-related organizations (e.g., 
customs brokers, baggage handlers) and that the current market rate for warehouse space in that 
area is $.80 per square foot. The Airport currently pays $0.64 per square foot for the facility for an 
annual cost of $191,061. 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

52 



Memo to Finance and Labor Committee 

April 21, 1999 Audit and Efficiency Committee Meeting 



to facilitate the recruitment and selection of approximately 
350 additional FTEs who will support the operations and 
maintenance of the new International Terminal building. As 
recruitment and selection procedures are not an on-going 
function, it is not clear that long-term rental of this much 
space is necessary. According to Mr. Franzella, the 
recruitment and selection process is expected to continue for 
three years. Mr. Franzella also explains that the space 
associated with this Human Resources function could be 
sublet if the space no longer proved necessary. 

3. The Budget Analyst notes that the square footage per 
employee appears high, especially for the General 
Administration office areas for which the Airport estimates 
376 sq. ft. per employee. Presently, General Administration 
employees occupy space of 146 sq. ft. per employee. Mr. 
Franzella indicated that the Airport has not finalized space 
planning for this subject facility and that additional 
functions may be relocated from the Airport to the subject 
facility. Such relocations would reduce square footage per 
employee projections and make available additional on- 
Airport space for rental opportunities. In addition, Mr. 
Franzella indicated that the Airport may sublet some space 
within the subject facility thereby also reducing the projected 
square footage per employee figures. 

4. In summary, the Airport expansion and pending new 
International Terminal operation has resulted in increased 
Airport staffing for operations support services that need not 
necessarily be located on site at the Airport. This proposed 
lease provides for the additional space needs of the increased 
staffing and warehouse expansion and is available for 
approximately $0.77 per square foot per month. In view of 
the fact that the space that will be vacated on-site at the 
Airport can be rented for monthly rates ranging from $1.75 
per square foot (for warehouse space) to $6.67 per square foot 
for office space, the proposed lease appears to be a sound 
business decision. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

53 



FROM SFIA DEPARTMENT OF AVIATION MANAGEMENT (THU) 4. 15' 99 14:52/ST. 



Proposed Aiipan Lease 
245 So. South Spruce Avenue 
Attachment! 
Page 3- 



Attachment I 
Page 3 of 3 



Warehouse Square Footage: 

Foisting Total 

Purpose 



FOMat 
Harbor Way 


25,000 


25,000 


Terminate Lease or sub-lst 


FOMat 
Airport 


153,431 


291.682 


Lease to 3" 1 party 


Attic Storage 
NewIT 


n/a 


110,000 




Custodial 
Supplies 


30,000 


65,000 


TWA Hangar to be demolished 
within 2 yr5. 



Totals 



208,431 491,682 



54 



FROM SFIA DEPARTMENT OF AVIATION MANAGEMENT (THU) 4. 15' 99 14:52/ST. 



Proposed Airport Commission Lease 



"Attachment 'II 



245 South Spruce Avenue 
South San Francisco, CA 

Attachment II 



Rental Cost: 

Area: 

Ground Floor Office Space 
Mezzanine Office Space 
Warehouse Space 

Total Monthly Rental Cost 
Annual Rental Cost . 



Sq.FL 

45,674 sq. ft. $1.25 

3,331 sq. ft. $0.73 

513,931 sq. ft. $0.73 



Mo. Rent Mo. Total 



$ 



57,092 

2,432 

375,169 



$ 434,693 
$ 5,216316 



Operating Expense: 



• The Landlord will be responsible for maintenance of building structure and building 
systems mfrastructure. 

• The Airport will be responsible for all utility, service and maintenance expenses. 

Warehouse ($1.20 x 513,931 sq.ft.) '.$ 620317 

Office ($7.00 x 49,005 sq.ft.) 343.035 

Estimated Annual Operating Expense $ 959,752 



55 



FROM SFIA DEPARTMENT OF AVIATION MANAGEMENT (THU) 4. 15' 99 

Attachment 



Proposed Airport Commission Lease 

245 South Spruce Avenue 
South San Francisco, CA 

Attachment III 



Revenue Potential: 



Relocation of on-Airport FOM shops will free on-airport space for development such 
as airline cargo handling/aviation support functions: 

• Vacated FOM space - 153, 431 sq. ft. 

• Projected rental rates - $21.00 /sq.ft. 

• Revenue Potential - $3,221,051 



Relocation of the Human Resources Office will free airport terminal office space for 
lease to tenants: 

• Vacated HR space 2,900 sq. ft. 

• Projected rental rates $ 80.00 / sq. ft. 

• Revenue Potential $ 232.000 



56 









'FROM SFIA DEPARTMENT OF AVIATION MANAGEMENT (THU) 4. 15' 99 14:53/ST. 



Proposed Airport Commission Lease 

245 South Spruce Avenue 
South San Francisco, CA 



Attachment IV 



Attachment IV 



Su mmar y; 



The lease of the building and land at 245 South Spruce Avenue hi South San Francisco, 
CA presents the City and County of San Francisco, acting through its Airport 
Commission with a unique opportunity. This site is unique beca u se it provides for the 
consolidation of multiple office functions, accommodates warehousing requirements and 
development of maintenance shop space all within the same location in extremely close 
proximity to the Airport Extremely limited on-Airport space has led to the elimination of 
training rooms and the use of rented space at hotels to provide required training. This site 
will provide multi-functional rooms for training, hirin g and exams that will eliminate that 
need. The site also includes ten acres of Tree" land for equipment and vehicle storage. 

The proposed lease provides Airport staff with a myriad of options for ongoing 
utilization including sub-letting in the future to aviation related vendors and service 
providers. Relocating non-site critical maintenance functions from the airfield will result 
in optimized revenue opportunities for airfield space. 



The following is a summary of alternatives: 

Lease office space at another site: 
25. 000 sq. ft @ $2SQJsq. ft 



Annual Cost/ (lost revenue) 
$ 870,000 



Lease warehouse space at another site: 
283,000 sq. ft @ $.75 sq. ft 
Estimated Operating Expense: 

Maintain 350 Harbor Way lease: 
Operating Expense: 



$ 2,547,000 
$ 339,600 

$ 191,061 
33,400 



Loss of on-Airport development revenue: $ 3,222,051 

Loss of Airport Office lease revenue: $ 232.000 

Lost Opportunity Cost $ 7,435412 

Proposed Lease and Operating Costs: $ 6,176.068 

Difference S 1.259.Q44 

Failure to act on leasing this site will be a missed opportunity that will not likely present 
itself again. 



57 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 

Item 8 - File 99-0684 

Department: Mayor's Office of Public Finance 

Mayor's Office of Housing 

Item: Resolution authorizing and directing the sale of not to exceed 

$20,000,000 of City and County of San Francisco Taxable 
General Obligation Bonds (Affordable Housing), Series 
1999A (the Series 1999A Bonds). 

Description: In November 1996, the voters of San Francisco approved 

Proposition A, which authorized the City to issue 
$100,000,000 in General Obligation Affordable Housing 
Bonds to (1) finance the development of rental housing 
affordable to low income households and (2) to provide down 
payment assistance to low- and moderate-income first-time 
homebuyers. 

In October 1997 the Board of Supervisors established 
authority for the Affordable Housing and Homeownership 
Bond Program (File 97-97-56) and approved regulations 
developed by the Mayor's Office of Housing for the Program 
(File 97-97-56.1). Mr. Joe LaTorre of the Mayor's Office of 
Housing advises that, under the Program, the City will issue 
$20,000,000 in General Obligation Affordable Housing Bond 
funds each year for five years, for a total of $100,000,000. 
According to Mr. LaTorre, 85 percent of the funds, or 
approximately $17,000,000 per year, will be used for 
affordable rental housing development and 15 percent, or 
approximately $3,000,000 per year, will be used for down 
payment assistance loans for first time homebuyers. In 
October 1997 the Board of Supervisors also established the 
general terms and procedures for the issuance of bonds under 
the Program (File 170-97-10) and authorized the issuance 
and sale of the first series of bonds under the Program (File 
170-97-10.1). The first series of $20,000,000 in bonds under 
the Program, City and County of San Francisco Taxable 
General Obligation Bonds (Affordable Housing) Series 
1998A, were issued in the amount of $20,000,000 on 
February 18, 1998. 

This proposed resolution would authorize and direct the sale 
of the second series of bonds, the Series 1999A Taxable 
General Obligation Bonds, in an amount not to exceed 
$20,000,000. The proposed resolution would also approve the 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

58 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 

form and terms of documents and official notices related to 
the bond sale, and authorize City officials to take various 
actions necessary to carry out the sale of the bonds. 

The general provisions of the sale of the Series 1999A Bonds 
would be as follows: 

• The sale of the bonds is tentatively scheduled to be held 
on May 26, 1999. 

• The bonds would be sold at an interest rate which would 
not exceed 12 percent per year and will mature in the 
year 2019. 

• An official statement describing the bonds to be issued is 
incorporated in the proposed resolution for approval by 
the Board of Supervisors. The official statement would be 
available to all bidders for the bonds. 

• Bonds will be awarded to the bidder whose bid represents 
the lowest interest cost to the City. 

• The City Treasurer may appoint fiscal agents or financial 
institutions to distribute bond interest payments. 

Comments: 1. As stated above, under the proposed resolution the annual 

interest rate of the bonds cannot exceed 12 percent. Ms. 
Laura Opsahl of the Mayor's Office of Public Finance reports 
that if the bonds were sold at this time, such bonds would be 
sold with an overall effective estimated interest rate of 
6.1871 percent, and would have an average estimated 
interest rate of 6.25 percent over the 20-year term of the 
bonds. 

2. The requested maximum bond authorization is 
$20,000,000. Ms. Opsahl estimates that with a 20-year term 
for the bonds and assuming an average interest rate of 
approximately 6.25 percent, the proposed sale of bonds in the 
amount of $20,000,000 would result in interest costs of 
approximately $15,556,638 and a total debt service 
requirement of approximately $35,556,638 over the 20-year 
term of the bonds. Over the 20-year period, this would result 
in an average debt sendee requirement of approximately 
$1,777,832 per year. 



BOARD OF SUPERIORS 
BUDGET ANALYST 

59 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 



3. Based on an average interest rate of 6.25 percent, the 
proposed bond sale in the amount of $20,000,000 would 
result in an increase in the Property Tax rate of $0,003 per 
$100 of assessed valuation. At that rate, the owner of a 
single-family residence assessed at $400,000 would pay 
$11.64 in additional Property Taxes annually due to the 
issuance of these bonds. 

4. Ms. Opsahl advises that the cost of issuing the bonds, 
including fees for private bond counsel, financial advisory 
services and the City Attorney's Office, are expected to be 
approximately $200,000. An appropriation request for such 
costs from the subject bond sale proceeds will be submitted 
for approval to the Board of Supervisors at a later date. 

5. Under the proposed resolution, the bonds to be sold, in an 
amount not to exceed $20,000,000, would be taxable General 
Obligation bonds. According to Ms. Opsahl, with taxable 
General Obligation bonds, an investor must pay Federal 
income taxes on interest earnings. Ms. Opsahl estimates 
that the interest rate that the City would pay on the subject 
$20,000,000 of taxable General Obligation bonds will be 
approximately 1.5 percentage points higher than the rate 
that the City would pay on Tax Exempt General Obligation 
Bonds. 

According to Mr. LaTorre, the subject bonds are unlike other 
City General Obligation bonds because, under the Affordable 
Housing and Homeownership Bond Program, the City would 
not directly expend the proceeds from these bonds but 
instead would act as a lender of the monies to other parties, 
which is regarded as a private activity use of these monies. 
Mr. LaTorre advises that, for private activity bonds to be tax 
exempt, certain additional governmental approvals would be 
required. 

As noted above, Proposition A, which was previously 
approved by the voters, specifies that Affordable Housing 
Bonds should be used to finance the development of 
affordable rental housing and for downpayment assistance 
loans to low income households. Mr. LaTorre advises that 
the portion of the subject bond monies to be used for 
downpayment assistance loans under this proposed issuance 
(approximately $3,000,000 out of a total of $20,000,000) 
could not qualify as tax exempt bonds. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

60 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 

However, under certain circumstances, the portion of the 
Affordable Housing bonds used to finance the development of 
affordable rental housing might qualify as tax exempt 
General Obligation bonds. According to Mr. LaTorre, in 
order to qualify as tax exempt bonds, the City must (1) 
receive approval from the California Debt Limit Allocation 
Committee (CDLAC) through a competitive process; (2) 
identify all projects to be funded; and (3) complete all projects 
within three years. However, according to Mr. LaTorre, at 
this time, applications to build affordable rental housing 
under the Affordable Housing and Homeownership Program 
are in various stages of readiness and the City would not be 
able to meet all the requirements for the issuance of tax 
exempt Affordable Housing bonds with regard to the Series 
1999A bonds. In addition, the private activity bond 
allocation available to CDLAC for 1999 is heavily 
oversubscribed, with applications received for approximately 
three times the amount of available allocation. 

6. All future expenditure appropriations of the bond 
proceeds, including appropriations to the Affordable Housing 
Bond Housing Fund and for bond issuance costs, would be 
subject to separate appropriation approval by the Mayor and 
the Board of Supervisors. 

Recommendation: Approval of the proposed resolution is a policy matter for the 
Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

61 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 9-99-0431 



Department: 



Item: 



Amount: 
Source of Funds: 
Description: 



Ethics Commission 

Department of Telecommunications and Information 

Systems (DTIS) 

Supplemental appropriation ordinance in the amount of 
$56,000 from the General Fund Reserve to fund an On- 
Line Electronic Filing Program for the Ethics Commission 
through a work order to the Department of 
Telecommunications and Information Systems. 

$56,000 

General Fund Reserve 

Article XIIB, Section 16.535 of the A dminis trative Code 
presently requires that whenever any elected officer, 
candidate or committee files a campaign finance 
statement with the Registrar of Voters in accordance with 
the California Political Reform Act, such elected official, 
candidate or committee must file at the same time a copy 
of the campaign finance statement on computer diskette 
or other electronic media with the Registrar of Voters. A 
campaign finance statement includes detailed information 
about the sources and uses of campaign fund 
contributions. 



According to Ms. Ginny Vida of the Ethics Commission, 
since 1996, such campaign finance statements are now 
filed with the Ethics Commission, rather than with the 
Registrar of Voters (see Comment No. 2). 

Mr. Vida reports that currently elected officers, 
candidates and committees have three options to comply 
with Section 16.535 of the Administrative Code. The first 
option involves a one-time expense by the elected officers, 
candidates or committees of $795 for the purchase of 
computer software. The second option requires on-going 
costs to elected officers, candidates or committees of 
approximately $3,000 per year from an online service 
provider. The third option is to submit a campaign finance 
statement on an Excel spreadsheet template, which was 
developed by DTIS and is free of charge to the public. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

62 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Mr. Joe Lynn of the Ethics Commission advises that the 
Ethics Commission staff must manuaDy input campaign 
finance information, which it receives from persons 
choosing from the above-noted options, into its computer 
database, and thereafter, requires DTIS technical 
assistance to post such information onto the Ethic 
Commission's website. 

The proposed ordinance would appropriate General Fund 
Reserve monies in the amount of $56,000 to the Ethics 
Commission to support an Ethics Commission's workorder 
to DTIS for DTIS to develop an On-Line Electronic Filing 
Program. Mr. Lynn advises that an On-Line Electronic 
Filing Program will enable persons to input campaign 
finance information directly onto an Internet site 
designated for the Ethics Commission. The Ethics 
Commission would then confirm and electronically 
transfer such information to its computer database and 
finally post the information onto its website. 

Mr. Lynn advises that under the On-Line Electronic 
Filing Program, the Ethics Commission would no longer 
have to manually input campaign Snance information 
into its computer database or require DTIS's technical 
assistance when posting such information to its website. 

Budget: According to Mr. Lynn, the total estimated cost of the On- 

Line Electronic Filing Program is $66,000. Therefore, 
this Program would require an additional $10,000 (total 
estimated cost of $66,000 less this requested 
supplemental appropriation request of $56,000). 
According to Mr. Lynn, $10,000 is available from 
workorder funds previously appropriated to DTIS for 
Fiscal Year 1998-99 to analyze the Ethic Commission's 
requirements for the On-Line Electronic Filing Program. 
The Attachment, provided by the Ethics Commission, 
contains the budget details for the total estimated project 
cost of $66,000. 

Comments: 1. According to Mr. Rod Loucks of DTIS, currently DTIS 

bills the Ethics Commission a total of approximately 
$13,700 per year for 280 hours at an hourly rate of 
approximately $49 for DTIS's technical assistance to 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

63 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Ethics Commission staff who post campaign finance 
information onto the Ethic Commission's website. Mr. 
Loucks estimates that after implementation of the On- 
Line Electronic Filing Program, DTIS will bill the Ethics 
Commission a total of approximately $17,300 per year in 
order for DTIS to recover its costs associated with 
providing approximately 240 hours of service at an hourly 
rate of $72 to maintain the On-Line Electronic Filing 
Program in FY 1999-2000. This represents a $3,600 
increase in annual DTIS costs for the Ethics Commission. 
Ms. Vida advises that the funding for such costs has been 
requested in the Ethics Commission's FY 1999-2000 
budget to provide the workorder funds to DTIS for DTIS 
to maintain the Ethics Commission's existing computer 
system network. 

2. According to Ms. Julia Moll of the City Attorney's 
Office, the Board of Supervisors has not yet approved 
legislation to amend the Administrative Code to reflect 
that with the implementation of the new City's Charter in 
1996, persons seeking to comply with Section 16.535 of 
the Administrative Code must file campaign finance 
statements with the Ethics Commission, rather than with 
the Registrar of Voters. Ms. Vida advised the Budget 
Analyst that she will request the Ethics Commission to 
consider drafting appropriate legislation to amend the 
Administrative Code to reflect the fact that campaign 
finance statement information must now be filed with the 
Ethics Commission and not with the Registrar of Voters. 

Recommendations: 1. Request the Ethics Commission to submit legislation 

to the Board of Supervisors for the purpose of amending 
the Administrative Code in order to reflect the fact that 
campaign finance statement information must now be 
filed with the Ethics Commission and not with the 
Registrar of Voters. 

2. Approve the proposed ordinance. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

64 



riAR-22-1999 15=37 



SF ETHICS COfTllSSION 



415 557 8757 P. 04/09 

Attachment 
Page 1 of 2 



Proposed System Deliverables 



Cost: $7,500 (150 hours at DTIS rale of $50.00 per hour) 

The definition of system requirements is an important part of any system development 
'effort. To date, general system requirements for electronic fiiing are known, such as 
what type of filing forms the system must produce and the fiie formats for the State of 
California. Aspects of the system must be explored in more detail and analyzed to 
make decisions required for system design. Decisions include preferences for the look 
and feel of the Internet data entry functions, the identification of system edits, a 
process for approving filed data for transmission to the Ethics Commission Web site, 
collecting information required for sizing the dirttibay and network, identification of 
reporting requirements, and other tasks associated with scoping and structuring the 
system. The process of defining requirements involves efforts on the part of the F^hi^ 
Commission staff, and various tcdMJCIMM who wiD architect and build the system. 
The end resuh of this effort will be publication oft requirements definition document. 



Cost: S36.500 (730 hours at DTIS rate of 550.00 per hour) 

A filer would access this system from any PC with a modem Internet browser (at 
home, business, or in a place like the Public library) using a pre-assigned password 
and encryption technology for security purposes. The filer will input campaign 
contribution data through an Internet Web page, data editing occurs, and ddB is seat 
to the Ethics Commission Microsoft Access datahasr The filer is able to print 
completed filing forms on his or her PC-connected printer. Filers who have their own 
PC software that generates an electronic file m the State's standard format would 
transmit or email this to the Ethics Commission. 



Cost: $12,000 (240 hours at DTIS rate of $50.00 per hour) 

Information that is sent to the Ethics Commissioo database will be posted to the City's 
Internet Web she upon confirmation of the data by the Ethics Commission. This will 
include data from the fiiing of campaign contribution disclosure information. 



Department or Telecommunications and Information Services 1/20799 

65 



Page 3 



MAR-22-1999 15:38 



SF ETHICS COMMISSION 



415 557 B757 P. 05/29 

Attachment 
Page 2 of 2 



Proposed System Deliverables (continued) 



Cost $10,000 (200 hours at DTIS rate ofS50.00 per hour) 

A series of computer programs will operate in a batch computing environment (non 
on-line) to perform system audits. These programs will be run by Ethics Commission 
staff or authorized auditors. Upon submission, these programs will produce a series of 
reports identifying data tttctp fi?***, errors and fn" m »^^ < found within the campaign 
contribution rigtafay. Data exceptions, errors and anomalies will be defined by the 
Ethics Commission in conjunction with the California Franchise Tax Board and other 
agencies. 



Proposed System Architecture 

A diagram on the next page depicts the proposed technical environment for operation of 
the electronic campaign contribution disclosure firing system. 



Department of Telecommunications and Information Serviccj 1/20/99 

66 



Page 4 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 10 - 99-0606 



Department: 



Item: 



Description: 



Health Services System (HSS) 
Department of Human Resources (DHR) 

Resolution establishing monthly contribution amount to 
be made to the Health Services Trust Fund by the City 
and County of San Francisco, the San Francisco Unified 
School District, and the San Francisco Community 
College District for Fiscal Year 1999-2000. 

The proposed resolution would establish the dollar 
amount of the employer's contribution to be made to the 
Health Service Trust Fund by the City and County of San 
Francisco (City), the San Francisco Unified School 
District (SFUSD), and the San Francisco Community 
CoUege District (SFCCD) for FY 1999-2000. 

The Health Services Board and the City and County 
Health Service System, as required by Charter Sections 
A8.423 and A8.428, have surveyed the ten most populous 
counties in the State (excluding San Francisco) to 
determine the average dollar contribution made by these 
counties toward each employee's medical care insurance 
(not including dental and optical care insurance). 

In accordance with the Charter, this resolution would 
establish the FY 1999-2000 monthly contribution rate for 
health care insurance to be paid by the City, the SFUSD, 
and the SFCCD, at $180.85 per month, or $2,170.20 
annually, for each eligible, active employee, based on the 
survey results of the average payment made by the ten 
most populous counties in California, excluding San 
Francisco, as shown below in order of most to least 
populous county: 

Average Contributed 
County Monthly Amount 

Los Angeles $208.79 

San Diego 164.99 

Orange 214.21 

Santa Clara 230.32 

San Bernadino 161.80 

Riverside 165.98 

Alameda 179.08 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

67 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Sacramento $176.36 

Contra Costa 146.05 

Fresno 160.91 

Total $1,808.49 

According to HSS, the ten-county survey for FY 1999- 
2000 indicates that the average employer contribution of 
the ten most populous counties in California (excluding 
San Francisco) is $180.85 per month, or $2,170.20 
annually, per employee, not including dental and optical 
care insurance. The City's current FY 1998-99 
contribution is $174.76 monthly, or $2,097.12 annually, 
per employee. The proposed resolution would establish 
$180.85 as the monthly per employee contribution to be 
made in FY 1999-2000 by the City, SFUSD, and SFCCD 
for the health insurance costs of their employees. The 
proposed monthly rate of $180.85 for FY 1999-2000 
represents an increase of $6.09 per month or 
approximately 3.5 percent from the $174.76 monthly rate 
currently contributed in FY 1998-99. 

Comments: 1. According to Ms. Ann Sommercamp of HSS, the total 

estimated City and County contribution cost for active 
employees during the current FY 1998-99 is $51.2 million. 
According to DHR, based on the current membership in 
HSS of approximately 25,607 active HSS members and 
the projected 3.5 percent increase in the employers' 
contribution rate for FY 1999-2000, the total employer 
contributions to the Health Service Trust Fund are 
expected to increase by $1.7 million from the FY 1998-99 
level of $51.2 million to an estimated $52.9 million for FY 
1999-2000. Of the estimated $52.9 million in employer 
contributions in FY 1999-2000, approximately $36 
million, or 68 percent, would be contributed from the 
City's General Fund, according to DHR. 

2. As previously noted, the City's contribution for health 
care coverage in FY 1999-2000 is equal to the average 
contribution of the ten most populous counties in 
California, excluding San Francisco, as determined by an 
HSS survey taken in January' 1999. Given that the 
surveyed counties may subsequently increase or decrease 
their actual contributions for FY 1999-2000, San 
Francisco's contribution may, in fact, be greater or less 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

68 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



than the actual average contributions to be provided by 
the ten counties in FY 1999-2000. However, because HSS 
is required by the Charter to collect the comparative data 
in January of each year, HSS is not able to set its FY 
1999-2000 rates based on the final FY 1999-2000 rates of 
the other ten surveyed counties. 

3. According to DHR, the estimated $52.9 million in total 
employer contributions for active employees for FY 1999- 
2000 does not include either (a) the cost of employer 
contributions toward dependent health insurance as a 
result of various collective bargaining agreements, (b) the 
cost to provide health coverage for retirees, or (c) the cost 
of employee health coverage for registered nurses, whose 
employer contribution rates are set without reference to 
the ten-county survey. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

69 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Item 11 - 99-0626 

Department: 

Item: 



Amount: 
Source of Funds: 



Department of Public Health (DPH), AIDS Office 

Resolution authorizing the Department of Public Health 
to expend a continuing allocation of grant funds in the 
amount of $434,319, for the nine-month period of June 1, 
1999 through February 28, 2000, from the Ryan White 
Comprehensive AIDS Resources Emergency (CARE) 
Disaster Relief Grant to replace home health care 
contractual services with similar services to be performed 
by City employees. 



$434,319 

U.S. Department of Health and Human Services 
White CARE Disaster Relief Grant 



Rvan 



Description: 



Section 12.4 of the Annual Appropriation Ordinance 
states that the Department of Public Health (DPH) shall 
not expend funds or add City employees to replace 
currently funded contractual services, provided by any 
type of organization, with services provided by City staff 
without the specific prior approval of the Board of 
Supervisors. This provision of the Annual Appropriation 
Ordinance was added by the Board of Supervisors in 
January of 1998, after DPH requested retroactive 
approval of a similar conversion of home health care 
services from a contract with Visiting Nurses Hospice 
Group, a non-profit organization, to a City program 
utilizing City employees. 

Approval of this proposed resolution would authorize the 
Department of Public Health (DPH) to expend a 
continuing allocation of grant funds in the amount of 
$434,319, for the nine-month period of June 1, 1999 
through February 28, 2000, from the Ryan White 
Comprehensive AIDS Resources Emergency (CARE) 
Disaster Relief Grant to hire additional City employees to 
assume provision of home health care services currently 
provided under a contract with the Visiting Nurses 
Hospice Group. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

70 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



The CARE grant provides disaster relief assistance to 
localities that are disproportionately affected by the AIDS 
epidemic. The CARE grant is administered by the U.S. 
Department of Health and Human Resources. The 
allocation of the CARE grant funds into a comprehensive 
budget is the responsibility of the HD7 Health Services 
Planning Council, a body whose 28 members are 
appointed by the Mayor. The distribution of these funds 
for FY 1999-2000, as set by the HP/ Health Services 
Pl annin g Council, included $434,319 for contractual 
services to provide home health care for persons with 
AIDS residing in San Francisco. 

Ms. Anne Okubo of DPH advises that currently the 
Visiting Nurses Hospice Group provides home health 
care, through a contract with DPH, to persons with AIDS 
residing in San Francisco. This contract is funded with 
CARE grant funds and expires on May 31, 1999. 
Attachment I, provided by DPH, contains descriptions of 
the home health care services provided under the Visiting 
Nurses Hospice Group contract. 

According to Ms. Okubo, DPH initiated a Request for 
Proposal process on February 1, 1999 to award a contract 
for the continuation of the subject home health care 
services beginning on June 1, 1999. Ms. Okubo states 
that proposals were due February 19, 1999. To date, 
DPH has received only one response from the Nurse 
Providers Home Health Group (NPHH), a private firm. 
The existing contractor, the Visiting Nurses Hospice 
Group, did not respond to DPH's request for proposals 
because, according to Ms. Nola Delia-Monica of the 
Visiting Nurses Hospice Group, California Pacific Medical 
Center, which operates the Visiting Nurses Hospice 
Group, made a policy decision not to renew any of its 
existing contracts with the City. 

According to Ms. Okubo, DPH has not awarded the 
contract to NPHH because NPHH submitted a bid in the 
amount of $636,306 to perform only a portion of the total 
home health care services, which are currently provided 
by the Visiting Nurses Hospice Group. Furthermore, Ms. 
Okubo states that the cost for NPHH to perform only a 
portion of the home health care services would be greater 

BOARD OF SUPERVISORS 

BUDGET ANALYST 

71 






Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

than DPrTs in-house cost to assume provision of the same 
volume of services as currently provided by the Visiting 
Nurses Hospice Group. As such, Ms. Okubo advises that 
if the proposed resolution is approved, DPrTs AIDS Office 
intends to use the subject CARE grant funds of $434,319 
to fund a workorder to DPHs Health Home Agency (HHA) 
for HHA to (1) hire 10.4 FTE additional staff on a 
temporary basis to provide all of the home health care 
services, except home infusion therapy and (2) fund a 
professional services contract for home infusion therapy 
services for the nine-month period of June 1, 1999 
through February 28, 2000. 

Budget: The total project budget for the nine-month period of June 

1, 1999 through February 28, 2000 is as follows: 

Permanent Salaries $249,337 

Fringe Benefits @ 15% 37,170 

Temporary Salaries 67,786 

Fringe Benefits @ 8% 5.190 

Subtotal $359,483 

Professional Services 

(Contract for Home 
Infusion Therapy) 74.836 

Total $434,319 

The details supporting this budget are shown in 
Attachment II, provided by Ms. Okubo. 

Comments: 1. According to Ms. Okubo, if the Visiting Nurses Hospice 

Group had continued to provide the subject home health 
care services, the cost of such services would have been 
equal to this budget of $434,319 as shown above. 

2. Ms. Okubo states that DPH intends to designate the 
new positions as "Grant-funded" so that authorization for 
these positions will end if CARE grant funds are not 
renewed after February 28, 2000. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

72 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

3. Ms. Okubo also states that DPH intends to award the 
professional services contract for the home infusion 
therapy services through a competitive selection process. 

Recommendation: Approval of the proposed resolution is a policy matter for 

the Board of Supervisors. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

73 



APR-15-1999 16: 10 SF DPH CFO 415 554 2S10 P. 02 

Attachment I 
Page 1 of 2 

(1) In-home Respite and Home Care Services 

Short-term para-professional care for persons living with AIDS or debilitating HTV disease who 
require supervision or care due to physical and/or mental status deterioration. Care should also" 
be rendered to periodically relieve family and friends who are caretakers of homebound clients. 
The target population is San Francisco residents who are low income and who have histories of 
substance use and/or who are persons of color. Priority needs to be given to patients who are 
uninsured and, secondarily, to patients who are insured but the needed services are not 
reimbursed by any other source of revenue. Services need to include homemaker, home health 
aide, personal care, attendant care, and non-medical assistance with cooking, cl eaning , running 
errands, accompanying patients to scheduled medical or related appoi n tments, childcare 
responsibilities and related household tasks. Services must be provided in accordance with a 
plan of care that has been developed by a local physician who assumes responsibility for the 
medical care of the patient' It is projected that services will be provided to 30 patients per year. 
It is anticipated that each client will receive an average of 96 hours of service per year. Please 
specify the projected cost per hour for this service. Also, any agency that submits a Letter of 
Interest for these services, must be a licensed home care agency. 

(2) Home Care for Low-Income Hotel Residents 

Services include skilled nursing interventions, medical social work, physical and occupational 
therapy, home care aide, peer advocacy and/or volunteer services. The target population is San 
Francisco residents with AIDS/HIV disease residing in residential hotels, other marginal settings 
in the Tenderloin or other low-income areas of San Francisco who require home health care 
services. It is anticipated that most clients will reside in the Tenderloin, Mission District, 
Western Addition, and Bayview districts of the City. Patients must be low income. Priority 
must be given to persons who are active substance users or who have histories of substance use 
and/or to persons of color. Patients may have mental health problems including mild to severe 
dementia. Priority must be given to patients who are uninsured and, secondarily, to patients who 
arc insured but the needed services are not reimbursed by any other source of revenue. These 
AIDS/HIV clients may have periods of health improvement in which they no longer meet 
homebound qualification for Medi-Cal reimbursement yet still need continued home care 
services to prevent relapse into homebound status or more expensive institutional care. An 
interdisciplinary team of Registered Nurses, Social Workers, Physical and Occupational 
Therapists, Home Care Aides and Peer Advocates must provide these services. Peer Advocates 
are generally HTV+ individuals who are paid to provide support services to clients. Peer 
Advocates complete a wide variety of activities including accompanying clients to medical and 
other appointments; assisting clients to access services and to adhere to medication regimes; 
providing practical support such as grocery shopping, washing dishes, running errands, laundry, 
etc. Community volunteers may also assist Home health disease manag ement must include 
assessments, skilled nursing care and case management, patient education, medication 
management, social work services, home care aide services, 24-hour on-call, and supervision. It 
is expected that this program will coordinate closely with the Bridge Project, operated by 
Lutheran Social Services, in serving clients from this program who live in Tenderloin hotels and 
other low-income residential settings. It is expected that this program will serve 100 clients per 
year with an average duration of services of 10 weeks. Although there is si gn i f icant variation in 
individual client need, it is expected that an average of 100 hours of service will be provided per 
client during their 10 weeks of contact with the program. Please specify the projected cost per 
patient day of service for mis program. 



74 



APR-15-1999 16: n 



SF DPH CFO 



415 554 2610 P.B3 

Attachment 



Page 2 of 2 

(3) Home Infusion 

Although there are outpatient infusion services available at San Francisco General Hospital, as 
patients deteriorate physically and neurologically, it becomes increasingly difficult, expensive 
and impractical for them to come into a clinic for care. Home infusion services include the 
provision of comprehensive home infusion therapy services and instruction, when appropriate, to 
patients and/or their caregivers leading to self-adrninistrarion of intravenous medications. The 
target population for this program is San Francisco residents with AIDS who require infusion 
therapy services and can demonstrate compliance with medication regimes at home, in 
residential hotels or other congregate residential settings. Patients must be low income. Priority 
must be given to patients who are uninsured and, secondarily, to patients who are insured but the 
needed services are not reimbursed by any other source of revenue. Priority should also be given 
to patients from San Francisco General Hospital and the Department of Public Health Primary 
Care Network. It is expected that approximately 40% of all patients will be able to self 
administer medication after a few teaching visits and that 60% will require long term home 
nursing services to administer prescribed medications. It is expected that 97% of all patients will 
be on long-term therapies. It is expected that home infusion visits will last 1 .5 to 2 hours and 
sometimes as long as 4 hours for certain medications. Specific services must include the 
following: 

preparation and delivery of medications 
provision of supplies needed to carry out home infusion therapy 
hospital visits prior to hospital discharge for paticnt/caregiver instruction 
visits at home for evaluation and case management 
serve as liaison between patient and physician 

monitor other physical and psychosocial needs and, as indicated, identify and make 
referrals to other disciplines to make home visits to carry out plan of care 
induction 

periodic patient monitoring (at least monthly) 
perform blood draws and deliver to appropriate laboratories 
cytotoxic waste disposal 

maintenance of home infusion therapy including maintenance of the central line for 
infusion, administration of the medication and dressing changes 
• provide directly or through collaborative arrangements 24-hour on call nursing 
support for patients requiring services after regularly scheduled visits, especially 
during the evening, night and weekend This on call nursing service must include 
triaging phone calls , providing information for the patient or caregiver, making home 
visits if indicated, and back-up system for emergencies. 
This program will not include the cost of medications. This program must operate 7 days per . 
week, 24 hours per day. Services must be provided in accordance with a plan of care that has 
been developed by a local physician who assumes responsibility for the medical care of the 
patient. It is expected that this program will serve 15 patients per year. Assume an average 
length of stay of 60 days. Assume that 8 of the clients have Mcdi-Cal and that 7 do not Please 
specify the projected cost per patient day. A patient day is defined as any day a patient is on . 
service and can include visits prior to hospital discharge, visits at home after discharge, or any 
day that therapy is self-administered (i.e., by the patient or care giver). Please clearly indicate 
the projected infusion pharmacy costs in your budget This service includes the preparation and 
delivery of medications such as Gancyclovir, Foscamet, Amphotericin-B, Acyclovir, and other 
medically indicated chemotherapy agents as well as the delivery of supplies, equipment and 
cytoxic waste containers. 



75 



TOTAL P. 83 



APR-15-1999 16: 10 



SF DPH CFO 



415 554 2610 P. 01 

Attachment II 





Department of Public He 


alth 








Home Health 








Conversion of Contract to Civil Service 




Perm Salaries 


















Biweekly 




Class 


Title 


Months 


FTE's 


Rate • 


ExDense 


2583 


Home Health Aide 


9 


4.0 


$ 945 


-$ 73.994 


2920 


Med Social Worker 


9 


0.5 


2.115 


20,701 


1424 


Clerk Typist 


9 


1.0 


1,161 


22,727 


2320 


Registered Nurse 


9 


2.8 


2,236 


122,555 


' 2556 


Physical Therapist 


9 


0.1 


2,161 


4.230 


2328 


Nurse Practitioner 


9 


QJ. 


2,621 


5,131 




Subtotal Perm Salaries 




8.50 




249,337 


Temporary Salaries 


















Biweekly 




Class 


Title 


Months 


FT^S 


Rate 


Expense 


2583 


Home Health Aide 


9 


1.0 


$ 945 


S 18,498 


"-2920 


Med Social Worker 


9 


0.1 


2.115 


4,140 


P103 


Per Diem Nurse 


9 


08 


2,883 


45,148 




Subtotal Temp Salaries 




1.90 




67,785 


Subtotal Salaries 











Fringe Benefits - Perm Salaries 
Fringe Benefits - Temp Salaries 
Subtotal Fringe Benefits 

Professional Services (1) 
Total 



15% 
8% 



37,170 
5,190 



317,123 



42,360 



74.836 
$434,319 



(1) Infusion contract 



Post-it* Fax Note 




L\suppk«m«ntal\vnh.XLS 4/15/99 9:48 AM Expense Budget 



76 



Memo to Finance Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 12 - File 99-0678 



Department: 
Item: 

Amount: 
Source of Funds: 

Description: 



Department of Public Health (DPH) 
Department of Public Works (DPW) 

Hearing to consider the release of reserved funds in the 
amount of $86,950 to fund preliminary design work for 
the C-Med Building located at 2789 25 th Street. 

$86,950 

Previously appropriated and reserved proceeds from the 
sale of Certificates of Participation (COPs). 

In May 1997 the Board of Supervisors approved a 
resolution authorizing the City to purchase a building 
located at 2789 25th Street, known as the C-MED 
Building, a portion of which was at that time leased by 
the City. 

The C-MED Building is currently used to house 
administrative staff for the Community Health Network. 

The May 1997 resolution authorized the issuance of up to 
$15,000,000 in Certificates of Participation (COPs). 1 The 
source of funds for payment of annual debt service for the 
COPs and operations and maintenance costs is the San 
Francisco General Hospital Operating Budget. 

In September 1997, the Board of Supervisors 
appropriated $10,665,000 of COP proceeds (File No. 101- 
97-17) for the Department of Public Health to finance the 
purchase, renovation and tenant relocation costs related 
to the C-Med Building. Attachment 1 contains a schedule 
of the $10,665,000 in costs for the C-MED Building 
Funds of $1,066,000 from the proceeds of the COPs were 
placed on reserve, including $726,000 for building 
improvements, pending the selection of contractors and 
submission of additional budget details. DPH is now 
requesting the release of $86,950, out of $1,066,000 on 
reserve, to pay for the first phase of work, involving 



1 A Certificate of Participation (COP) is a financing technique that provides long term financing 
through a lease or installment sales agreement. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 
77 



Memo to Finance Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Budget: 



preliminary design work and minor demolition and 
improvements. 

A summary budget for tbis request of $86,950 is as 
follows: 



Description of Work 


Estimated Cost 


Preliminary Design - DPW 


$20,000 


Contractual Services: 




Demolition/Rep airs 


2,960 


Carpet and Linoleum 


2,583 


Electrical 


4,368 


Painting 


7,590 


Modular Office Equipment 


49.449 


Subtotal 


$66,950 


Total 


$86,950 



Comment: 



Recommendation: 



Attachment 2, provided by Ms. Zmuda, identifies the 
contractors selected, the amounts allocated to each 
contractor, and the work to be performed by each 
contractor. In addition, the Budget Analyst has examined 
documentation supporting Attachment 2 for the work to 
be performed. 

Each of the contractors for the work described above was 
solicited from a pool of contractors (identified on 
Attachment 3) established by DPH in September 1998 
and selected on a competitive basis. 

Approve the requested release of reserved funds. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

78 



Attachment I 



ATTACHMENT 1 

Department of Public Health 

CMED Bunding 

2789 25th Street 

Acquisition Costs 



Purchase Price 



Building improvements 
Relocation Costs of Existing Tenants 



Project Costs 



Financing Costs 



Appraisal Services 

Arbitration Fees 

City Attorney 

Department of Real Estate 

Contingency 

Subtotal 



Debt Service Reserve Fund 

Underwriter's Discount 

Moody's Rating 

S&P Rating 

Fitch Rafog 

Trustee Fee 

Financial Advisor Fee 

Financial Advisor Expense 

Bond Counsel 

Bond Counsel Expenses 

City Attorney 

Controller 

Public France 

Printing 

Advertising 

ALTATffle Policy 

Property & Casualty Insurance 

Misc/Cortingency 

Subtotal 



Subtotal Financing Costs 
Total Costs 



$ 8,074,000.00 

726,000.00 

300,000.00 

16,700.00 
10.000.00 
90,000.00 
58.300.00 
100.000 , 
275.000.00 

886,422.50 

159,975.00 

10,000.00 

10,000.00 

9.000.00 

7,500.00 

9,500.00 

1.000.00 

70,000.00 

7,500.00 

25,000.00 

20,000.00 

20,000.00 

15,000.00 

3.500.00 

15,000.00 

15.000.00 

5£Q2J5Q 

243,602.50 

1.290 000 m 

10,665.000.00 



l-'»fmnmaiEDXJS 



79 



Attachment II 



I 



— <u 



O O 



4) •— ±P 



.5 3 _ 



n 

X ;> 

il S3 

£!£ 

c 111 </> 

(D 



U 



co 



Z 



.2 o 

= c 






a 
a. 



Q £ 



C 
B 

II 
II 

Q 4) 



(D _ R> 

5 s 1 

S S • 

= ._ e 

° ° § 

8 1 2" 






Ore 
U 



= 3 

75 O 

c. 2 



80 



Attachment III 



FAX MEMORANDUM 



April 15, 1999 

TO: Anne Okubo 

DPH Finance 
Fax 554-2808 

James Edison 
Budget Analyst 
Fax 252-0461 

FROM: Carlos VuTalva V^< 

CHN Facility Management 

FAX: 206-4515 

RE: Release of Funds Held on Reserve - CMED Building 

Supplementary Information 
96004 
95008 




As requested, below is the list of contractors who currently are on contract to the CHN in an 
as-needed pool, from which one of each trade was selected for specific minor repairs at the CHN 
Headquarters. 



Agbayani Construction 


carpentry 


Adolph Schmidt 


carpentry 


Angotti and Reilly 


carpentry 


Sab el Painting 


painting 


Baca & Sons 


painting 


Monticelli Painting 


painting 


McClure Electric 


electrical 


Sierra Electric 


electrical 


Anderson Carpet and Linoleum 


flooring 


Floor Trends 


flooring 



Office of Architecture and Facility Planning 

COMMUNITY HEALTH NETWORK of SAN FRANCISCO 

BWg 10, Room 1118,1001 Potraro Avanue 

San Francisco. CA 94110 



81 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 



Item 13 - File 99-0508 

Department: 

Item: 



Description: 



Department of Administrative Services (DAS) 

Resolution authorizing the Department of Administrative 
Services Commute Assistance Program to create a 
program which would provide City employees with an 
option to take advantage of a "pre tax" salary deduction 
program to subsidize employees' cost of using public 
transit. 

The Federal Transportation Equity Act for the 21 st 
Century, signed into law in June, 1998, included an 
amendment to the Internal Revenue Service (IRS) Code 
that would permit employers to deduct up to $780 per 
year from employees' salaries on a "pre-tax" basis in order 
to pay for public transit expenses. The pre-tax salary 
deduction program is intended to encourage the use of 
public transit for commuting. City employees would 
receive vouchers in the amount of the pre-tax salary 
deduction that could only be used for public transit. The 
employees would realize a savings by not paying Federal 
Income Tax on up to the $780 annual deduction. 

The proposed resolution would authorize the DAS 
Commute Assistance Program to create the pre-tax salary 
deduction program and authorize the Purchaser to 
conduct a one-year pilot project to analyze any costs and 
savings of the pre-tax salary deduction program. The 
results of the pilot project would be reported to the Mayor 
and Board of Supervisors for consideration of creating a 
permanent salary deduction program. 

The cost of the program is expected to be approximately 
$4 to $5 per participating employee per month. This cost 
would be in the form of payments to an existing City third 
party benefits administrator who would provide tracking, 
accounting, reporting and marketing services. A savings 
would also be realized as the City would not be required 
to pay Social Security and Medicare contributions of 7.65 
percent on the salary deduction in an amount of up to 
$780. The payments to the third party benefits 
administrator would be made from departmental 
appropriations for mandatory fringe benefits. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

82 



Memo to Finance Committee 

April 21, 1999 Finance Committee Meeting 



The net incremental cost to the City would therefore 
depend on 1) the actual cost of the third party benefits 
administrator; 2) the number of employees' participating 
in the salary deduction program; and, 3) the savings to 
the City through reduced Social Security and Medicare 
payments. 

According to Chief Deputy Controller John Madden, the 
salary deduction program would not result in increased 
payroll processing costs for the City. 

The Attachment to this report, submitted by Mr. Rick 
Ruvolo of the DAS, provides more detailed information for 
the proposed pre-tax salary deduction program. 

Recommendation: Approval of the proposed resolution is a policy matter for 

the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

83 



Attachment - Page 1 of 2 



Memorandum 



To: Chairman Yee and the Members of the Finance Committee 

From: Rick Ruvolo - Coordinator, City Employees Commute Assistance Program (CECAP) 

Through: Steve Nelson - Director, Department of Administrative Services 

Date: April 15, 1999 

Re: Tax Free Transit Subsidy Proposal for City Employees 



Commuter Choice Program Allows Tax Free Transit Benefits 
Recent federal legislation now provides an exciting opportunity to: 

1) Subsidize employee transit expenses 

2) Reduce General Fund payroll tax obligations 

3) Increase MUNI revenue/ridership 

4) Decrease the demand for parking 

5) Continue innovative programs to improve air quality 

The Transportation Equity Act for the 21st Century (TEA-21) was signed into law by President Clinton 
on June 9, 1998. A section of this omnibus federal transportation legislation (Title DC, Section 910) 
amended the federal tax code, Internal Revenue Code Section 132(f) to allow employers to offer their 
employees a pre-tax salary reduction as a way to pay for transit tickets. This transportation benefit is 
known as the Commuter Choice program. 

The Commuter Choice program allows employees to have pre-tax salary reduced by up to S780 per year 
to pay for transit (the $780 maTimnm deduction likely will be increased in future years). By using pre- 
tax dollars to pay for transit expenses, employees can save a significant amount of money. For every 
dollar of taxable salary reduced, employees can reduce their transit costs by approximately 40% 
(assuming a combined Federal/State income tax of 33% and FICA/Medicare deductions of 7.65%). 
Through this program, employees can save between SI 25 to S325 per year on transit costs, depending on 
salary reduction amount and tax bracket Looked at another way, S65 worth of monthly transit could cost 
as little as $40 and $35 worth of monthly transit could cost as little as $20. 

The commuter choice program also offers savings for the employer. The City and County of San 
Francisco will save 7.65% in payroll tax for every employee salary dollar reduced. Savings are realized 
through a reduction in the employer share of FICA/Medicare. Savings generated through this program 
will help pay for the administrative cost of the program. 






84 



Attachment - Page 2 of 2 



The specifics of the Commuter Choice portion of the TEA-21 legislation are still undergoing 
interpretation by the Internal Revenue Service. In the interim, the Department of Administrative Services 
would like to initiate a one year demonstration Commuter Choice program for City and County of San 
Francisco employees. The demonstration program will help determine the level of interest in Commuter 
Choice benefits and help the City develop a cost effective and efficient permanent program. 

The City Employees Commute Assistance Program (CECAP) will oversee the implementation of the 
demonstration program with the assistance of the Office of the Controller/Payroll. During the one year 
demonstration period, the program will be administered by a third party administrator. Employee Benefit 
Specialists (EBS), which currently has a contract with the City. EBS will provide tracking, accounting, 
reporting, marketing, and other administrative services. Negotiations currently are under way with EBS 
and it appears that the program will cost between $4 to S5 per participant (part of this cost is a 3% 
administrative fee imposed by the Commuter Check voucher vendor). Most of the program costs will be 
covered by the reduction in payroll taxes mentioned previously. 

This program will be available to all employees of the City and County of San Francisco. Employees will 
receive information about the program with their paychecks, along with a deduction form. Emplovees 
interested in the program will choose a deduction of SI 5, S20, or S30 per pay period and forward the 
form to Payroll. Payroll will enter all deduction requests into the payroll computer and forward copies to 
EBS. EBS will order the Commuter Check vouchers and mail them to the program participants' home 
address. Participants may use the Commuter Checks at most locations that sell transit tickets. 
Participants may elect to discontinue the deduction, if they wish. 

We are excited about this program. We believe that the opportunity to use pre-tax dollars for transit 
expenses will provide employees with a valuable transportation benefit. We anticipate that this program 
will not impose a significant financial burden on the City, though this issue and all other aspects of the 
program will be analyzed during the demonstration period. 

Please feel free to contact our office with any questions you may have about the Commuter Choice 
program. 

Thank you. 



85 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Item 14-99-0627 



REVISED April 20. 1999 



Department: 



Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

No. of Sq. Ft. and 
Cost Per Month: 






Department of Public Health (DPH) 
Department of Real Estate (DRE) 



K~~ r7N '-^<^({^_ 



Resolution authorizing and approving a master lease by 
and between the City and County of San Francisco, 
through the Department of Public Health, as the lessee, 
and 238 Windsor Associates, as the lessor, for the 
"Windsor Hotel" located at 238 Eddy Street. 

238 Eddy Street 

Secure affordable housing for low-income City residents 
who are medically frail, are at-risk of homelessness, have 
recently exited homeless shelters, or have recently left a 
residential treatment program. 

238 Windsor Associates 

City and County of San Francisco 



Approximately 45,800 square feet at a cost of 
approximately $0.68 per square foot or $31,200 per 
month. 



Annual Cost: 

Utilities and 
Janitorial Services: 



Term of Lease: 



Source of Funds: 



$374,400 



The lessee would be responsible for utilities and janitorial 
service. 

Ten-year term beginning on May 1, 1999 and terminating 
on April 30, 2009. The lease can be cancelled by either 
party after giving 100 days notice. 

For FY 1998-99 costs of $62,400 for the two-month lease 
period from May 1, 1999 through June 30, 1999, DPH 
would fund the lease with previously appropriated, but 
unspent General Fund monies. For FY 1999-2000 costs of 
$374,400, DPH would fund the lease from General Fund 
monies requested by DPH for the FY 1999-2000 DPH 
budget. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

86 



DOCUMENTS DEPT 

APR 2 \ ;999 
SAN FRANCISCO 

di IQI IP ! IRRARV 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

Description: Under the proposed resolution, the City would enter into 

a master lease with 238 Windsor Associates in order to 
sublease the 104 single residential occupancy (SRO) units 
at an average rent of $300 per month ($31,200 per month 
divided by 104 units) at the Windsor Hotel to eligible 
Direct Access to Housing Program participants. The 
Direct Access to Housing Program makes available 
affordable housing with DPH-provided on-site support 
services such as mental health services, life skills 
development, and access to medical care in order to 
stabilize the housing situation and improve the health of 
the program clients. According to Ms. Pam Sims of DPH, 
the program seeks to address the lack of affordable 
housing in the City which has exacerbated the health 
status of indigent and homeless persons who cycle in and 
out of emergency or crisis service systems such as medical 
facilities, treatment centers, homeless shelters, and jail. 
Ms. Sims explains that the program was designed to fill 
the housing gap between emergency shelter/health 
systems and permanent affordable housing, and to better 
utilize these crisis shelter and health services. 

According to Ms. Sims, a homeless adult is eligible to 
participate in the program if he or she is extremely low 
income (defined by DPH as less than or equal to 20 
percent median income upon entry into the program) and 
has a history of living on the streets, in emergency shelter 
or other temporary housing; or has been released from 
institutional, acute or transitional settings; or has a 
history of rotating through various systems of care 
without prolonged stabilization in their housing or health 
status. Homeless adults would be referred to the 
Program by emergency shelters, other temporary housing 
programs, or street outreach and treatment programs. 

In addition to the on-site support services, which consist 
of mental health services, life skills development, and 
medical care, DPH would provide a rental subsidy for the 
clients. The tenants would be required to pay 50 percent 
of their estimated monthly income of $464, or an average 
of $232 per month, toward the $300 monthly rent charged 
for a SRO unit at the Windsor Hotel. The portion of the 
rental charge paid by the tenant would usually come from 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

87 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Supplemental Security Income (SSI) or some other public 
assistance, according to Ms. Sims. The rent subsidy 
would be available for two years, with the possibility of an 
extension if the tenant, for example, either cannot find 
permanent housing, or just obtained employment and has 
not saved enough funds for a security deposit on an 
apartment, or is experiencing a deteriorating health 
condition. The length of the extension, according to Ms. 
Sims, is determined on a case by case basis, depending on 
the client's situation, by DPH program staff. 

DPH would contract with The John Stewart Company, 
selected through a Request for Proposal (RFP) process 
(RFP No. 020-98), to perform the property management 
and administrative functions of the Direct Access to 
Housing Program related to the Windsor Hotel. Ms. Sims 
reports that this proposed contract is scheduled to be 
heard at the April 20, 1999 Health Commission meeting. 
Ms. Sims states that no other company submitted a bid 
for this contract during the RFP process which was 
conducted in September 1998. The RFP was mailed to 
over 300 firms. 

According to Ms. Sims, program costs for the FY 1998-99 
period of May 1, 1999 through June 30, 1999, would be 
$328,571, which includes the $62,400 lease amount 
payable to the Windsor Hotel based on a $31,200 per 
month for 42 Program participants (see Comment No. 3), 
$71,136 for the on-site services, and $195,035 for 
operating costs. The program costs for the FY 1999-2000 
period of July 1, 1999 through June 30, 2000 would be 
$1,428,771, which includes the $374,400 lease amount 
payable to the Windsor Hotel based on $31,200 per month 
for 104 Program participants at an average monthly rent 
of $300 per participant, $427,755 for the on-site services, 
and $626,616 for operating costs. The total costs for the 
DPH Direct Access to Housing Program for the proposed 
14-month contract period from May 1, 1999 through June 
30, 2000 is $1,757,342, for the utilization of 104 units at 
the Windsor Hotel, as summarized below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

88 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Category A™ "" 1 
John Stewart Co. Contract for Operating 

and Capital Expenses $821,651 

Windsor Hotel Building Lease 436,800 

DPH On-Site Services 498.891 

Total $1,757,342 

Attachment I provided by DPH details the expenditures 
for the proposed program budget of $1,757,342, including 
the $436,800 for the lease costs (circled on Attachment I) 
of the 14-month contract. 

The Windsor Hotel would receive a total of $436,800 to 
cover the lease costs of the 14-month contract which is 
$31,200 per month for 104 participants. The John 
Stewart Company would receive $821,651 to (a) purchase 
furniture, equipment, and maintenance supplies, (b) 
provide operations staff, including desk clerks and 
maintenance workers, to operate the facility, (c) perform 
other administrative functions related to the operation of 
the Direct Access to Housing Program, such as credit 
reports and insurance payments. 

The source of funds for the project costs of $1,757,342 for 
the 14-month contract period would be as follows: 

Source Amount 

General Fund $1,363,925 

($301,816 from FY 1998-99 Budget and 

$1,062,109 from FY 1999-2000 Budget) 

Hilton Foundation Grant 115,000 

(through the Corporation for Supportive Housing) 

Anticipated Rental Income 278.417 

Total $1,757,342 

Ms. Sims reports that currently, there are 25 Direct 
Access to Housing Program participants who live at the 
Pacific Bay Inn, located at 520 Jones Street. These 25 
participants pay an average monthly contribution of $232 
toward the $350 monthly rent and $250 average monthly 
cost of on-site services at the Pacific Bay Inn. All current 
program clients live at the Pacific Bay Inn, located at 520 
Jones Street. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

89 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

At tbe Windsor Hotel, tbe 42 persons presently occupying 
42 units pay an average of $343. Tbe actual cost of the 
lease, on-site services and operating expenses is 
approximately $1,000 per month. Of the 42 persons 
currently at the Windsor Hotel, all are low-income and 31 
participate in a similar program administered by the 
Tenderloin Housing Clinic (THC). Ms. Sims explains that 
these 42 persons would be screened and cycled into the 
DPH Direct Access to Housing Program, as needed. The 
anticipated rental income of $278,417 for the 14-month 
contract period reflects the contribution of the existing 42 
participant tenants, according to Ms. Sims. The 
anticipated rental income of $278,417 was calculated by 
multiplying the $343 average monthly rent contribution 
by each of the existing 42 tenants for 14 months plus the 
$232 average monthly rent contribution by each of the 
new tenants expected beginning in July and increasing 
each month until the program reaches capacity at 104 
units, as explained in Attachment II provided by DPH. 
According to Mr. Harry Quinn of DRE, under the 
proposed lease, all 104 units in the Windsor Hotel would 
become available to DPH for the Direct Access to Housing 
Program within ten days of the Mayor's and Board of 
Supervisors approval of the proposed lease. 

Comments: 1. The proposed resolution would authorize the Director 

of Property to make any additions, amendments, or other 
modifications to the proposed master lease agreement 
without prior approval of the Board of Supervisors if such 
amendments are in the best interest of the City and do 
not materially increase the City's obligation. 

2. The proposed resolution would authorize DPH to 
include in the master lease a clause, in a form approved 
by DRE and the City Attorney, that would indemnify- and 
hold harmless the Lessor from any claims incurred as a 
result of the City's use of the premises. According to Mr. 
Ted Lakey of the City Attorney's Office, these waivers are 
standard and pose minimal additional risk to the City. 
Mr. Lakey states that this provision would require the 
City to defend and pay damages assessed against the 
Lessor arising out of negligence by the City in the 
performance of the proposed contract. Mr. Lakey advises 
that the City has entered into other agreements which 

ROARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



include similar indemnification provisions and waivers 
and that the risk of additional liability to the City is 
minimal. 



Recommendation: 



cc: Supervisor Yee 

Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



3. DPH anticipates that there would not be a significant 
number of new tenants for the first two months of the 
lease period from May 1, 1999 through June 30, 1999 
because the Direct Access to Housing Program is a new 
program, and DPH staff needs to inform emergency 
shelters and other transitional housing facilities about the 
availability of the program. The City is required to pay 
the rent for the entire 104 units of the Windsor Hotel, 
even if only 42 units (total number of existing tenants) of 
the total 104 units are occupied. 

Approval of the proposed resolution is a policy matter for 
the Board of Supervisors. 



/y^7. /^v 



Harvey M. Rose 






BOARD OF SUPERVISORS 
BUDGET ANALYST 

91 



PFR-14-1999 12=46 



DPH HOUSING 



Draft Windsor Hotel Budget 
April 5, 1999 



415 5S4 2704 P. 02 

ATTACHMENT I 
Page 1 of 0- 







On* Year 






Budget 






(July-99- 




Start-lip (May) 


June'QO) 


Initial Capital Costs 






Furniture. Equipment & Reserves 


125,727.00 




Maintenance Supplies 


3,545.00 




Maintenance & Damage Deposit 


0.5 31,200.00 




f Rent 


62,400.00 J 




Subtotal 


222,872.00 





Operating 










JSCo 










Administrator 


1 


6,666.00 


1 


$40,000.00 


AssL Administrator 


1 


4,666.00 


1 


$28,000.00 


Desk Clerks 


4.22 


10,248.00 


4.22 


$61,320.00 


Maintenance Worker 


1 


5.200.00 


1 


$31,200.00 


Asst Maintenance Worker 


0.5 


1,820.00 


0.5 


$10,920.00 


Janitor 





0.00 


1 


$18,680.00 


Security 





0.00 


1 


$22,000.00 


Vac/Sick/Hoi/Em Cov 





0.00 
28.600.00 





$0.00 
$212,120.00 


Benefits© 17% 




4.802.00 




$36,448.00 


Sub-totals 


7.72 


33,402.00 


9.72 


■ 5248,568.00 


Indirect Costs @ 1 .5% 




501.00 




$3,729.00 


Total 




33,903.00 
Start-Up (May) 




$25237.00 

One Year 
Budget 
(Juiy99- 

Juna'00) 


Credit Reports 




660.00 




$1,485.00 


Administrative 




0.00 




$75,436.00 


Utilities 




0.00 




$63,600.00 


Repairs and Maintenance 




0.00 




$58,980.00 


Maintenance & Damage Deposit 




0.00 




$31,200.00 


Insurance and Taxes 




0.00 




S32.880.00 


Service 




000 




$130.00 


I Building Lease 




0.00 




S374 Anq jm_ 


humrture, Equipment & Reserves 




0.00 


$109,538.00 


Subtotal 




660.00 




$748,719.00 


Total 




257.435.00 




$1,001,016.00 


GRAND TOTAL OP&P-AT10N/ AL 


4 L£4S 


:& corns: 




1,258,451.00 



TOTAL P. 02 



92 



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96 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Item 14 - 99-0627 



Department: 



Item: 



Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

No. of Sq. Ft. and 
Cost Per Month: 

Annual Cost: 

Utilities and 
Janitorial Services: 

Term of Lease: 

Right of Renewal: 

Source of Funds: 



Department of Public Health (DPH) 
Department of Real Estate (DRE) 

Resolution authorizing and approving a master lease by 
and between the City and County of San Francisco, 
through the Department of Public Health, as the lessee, 
and Michael J. Bovo and Associates, Inc., as the lessor, for 
the "Windsor Hotel" located at 238 Eddy Street. 

238 Eddy Street 

Secure affordable housing for low-income City residents 
who are medically frail, are at-risk of homelessness, have 
recently exited homeless shelters, or have recently left a 
residential treatment program. 

Michael J. Bovo and Associates, Inc. 

City and County of San Francisco 



Approximately 45,800 square feet at a cost of 
approximately $0.68 per square foot or $31,200 per 
month. 

$374,400 



The lessee would be responsible for utilities and janitorial 
service. 

14-month term beginning on May 1, 1999 and terminating 
on June 30, 2000. 

The City would have nine one-year renewal option 
periods. 

For FY 1998-99 costs of $62,400 for the two-month lease 
period from May 1, 1999 through June 30, 1999, DPH 
would fund the lease with previously appropriated, but 
unspent General Fund monies. For FY 1999-2000 costs of 
$374,400, DPH would fund the lease from General Fund 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

86 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

monies requested by DPH for the FY 1999-2000 DPH 
budget. 

Description: Under the proposed resolution, the City would enter into 

a master lease with Michael J. Bovo and Associates, Inc. 
in order to sublease the 104 single residential occupancy 
(SRO) units at an average rent of $300 per month 
($31,200 per month divided by 104 units) at the Windsor 
Hotel to eligible Direct Access to Housing Program 
participants. The Direct Access to Housing Program 
makes available affordable housing with DPH-provided 
on-site support services such as mental health services, 
life skills development, and access to medical care in 
order to stabilize the housing situation and improve the 
health of the program clients. According to Ms. Pam Sims 
of DPH, the program seeks to address the lack of 
affordable housing in the City which has exacerbated the 
health status of indigent and homeless persons who cycle 
in and out of emergency or crisis service systems such as 
medical facilities, treatment centers, homeless shelters, 
and jail. Ms. Sims explains that the program was 
designed to fill the housing gap between emergency 
shelter/health systems and permanent affordable housing, 
and to better utilize these crisis shelter and health 
services. 

According to Ms. Sims, a homeless adult is eligible to 
participate in the program if he or she is extremely low 
income (defined by DPH as less than or equal to 20 
percent median income upon entry into the program) and 
has a history of living on the streets, in emergency shelter 
or other temporary housing; or has been released from 
institutional, acute or transitional settings; or has a 
history of rotating through various systems of care 
without prolonged stabilization in their housing or health 
status. Homeless adults would be referred to the 
Program by emergency shelters, other temporary housing 
programs, or street outreach and treatment programs. 

In addition to the on-site support services, which consist 
of mental health services, life skills development, and 
medical care, DPH would provide a rental subsidy for the 
clients. The tenants would be required to pay 50 percent 
of their estimated monthly income of $464, or an average 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

87 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



of $232 per month., toward the $300 monthly rent charged 
for a SRO unit at the Windsor Hotel. The portion of the 
rental charge paid by the tenant would usually come from 
Supplemental Security Income (SSI) or some other public 
assistance, according to Ms. Sims. The rent subsidy 
would be available for two years, with the possibility of an 
extension if the tenant, for example, either cannot find 
permanent housing, or just obtained employment and has 
not saved enough funds for a security deposit on an 
apartment, or is experiencing a deteriorating health 
condition. The length of the extension, according to Ms. 
Sims, is determined on a case by case basis, depending on 
the client's situation, by DPH program staff. 

DPH would contract with The John Stewart Company, 
selected through a Request for Proposal (RFP) process 
(RFP No. 020-98), to perform the property management 
and administrative functions of the Direct Access to 
Housing Program related to the Windsor Hotel. Ms. Sims 
reports that this proposed contract is scheduled to be 
heard at the April 20, 1999 Health Commission meeting. 
Ms. Sims states that no other company submitted a bid 
for this contract during the RFP process which was 
conducted in September 1998. The RFP was mailed to 
over 300 firms. 

According to Ms. Sims, program costs for the FY 1998-99 
period of May 1, 1999 through June 30, 1999, would be 
$328,571, which includes the $62,400 lease amount 
payable to the Windsor Hotel based on a $31,200 per 
month for 42 Program participants (see Comment No. 3), 
$71,136 for the on-site services, and $195,035 for 
operating costs. The program costs for the FY 1999-2000 
period of July 1, 1999 through June 30, 2000 would be 
$1,428,771, which includes the $374,400 lease amount 
payable to the Windsor Hotel based on $31,200 per month 
for 104 Program participants at an average monthly rent 
of $300 per participant, $427,755 for the on-site services, 
and $626,616 for operating costs. The total costs for the 
DPH Direct Access to Housing Program for the proposed 
14-month lease period from May 1, 1999 through June 30, 
2000 is $1,757,342, for the utilization of 104 units at the 
Windsor Hotel, as summarized below: 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

88 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Category Amount 
John Stewart Co. Contract for Operating 

and Capital Expenses $821,651 

Windsor Hotel Building Lease 436,800 

DPH On-Site Sendees 498.891 

Total $1,757,342 

Attachment I provided by DPH details the expenditures 
for the proposed program budget of $1,757,342, including 
the $436,800 for the costs (circled on Attachment I) of the 
14-month subject lease. 

The Windsor Hotel would receive a total of $436,800 to 
cover the costs of the 14-month lease which is $31,200 per 
month for 104 participants. The John Stewart Company 
would receive $821,651 to (a) purchase furniture, 
equipment, and maintenance supplies, (b) provide 
operations staff, including desk clerks and maintenance 
workers, to operate the facility, (c) perform other 
administrative functions related to the operation of the 
Direct Access to Housing Program, such as credit reports 
and insurance payments. 

The source of funds for the project costs of $1,757,342 for 
the 14-month lease period would be as follows: 

Source Amount 

General Fund $1,363,925 

($301,816 from FY 1998-99 Budget and 

$1,062,109 from FY 1999-2000 Budget) 

Hilton Foundation Grant 115,000 

(through the Corporation for Supportive Housing) 

Anticipated Rental Income 278.417 

Total $1,757,342 

Ms. Sims reports that currently, there are 25 Direct 
Access to Housing Program participants who live at the 
Pacific Bay Inn, located at 520 Jones Street. These 25 
participants pay an average monthly contribution of $232 
toward the $350 monthly rent and $250 average monthly 
cost of on-site sendees at the Pacific Bay Inn. All current 
program clients five at the Pacific Bay Inn, located at 520 
Jones Street. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

89 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 

At the Windsor Hotel, the 42 persons presently occupying 
42 units pay an average of $343 toward the $300 monthly 
rent. Ms. Sims explains that the average cost of $343 for 
existing tenants per month is higher than the $300 rent 
amount because some tenants are able to pay for utility 
and security costs. Of the 42 persons currently at the 
Windsor Hotel, all are low-income and 31 participate in a 
similar program adm i nistered by the Tenderloin Housing 
Clinic (THC). Ms. Sims explains that these 42 persons 
would be screened and cycled into the DPH Direct Access 
to Housing Program, as needed. The anticipated rental 
income of $278,417 for the 14-month lease period reflects 
the contribution of the existing 42 participant tenants, 
according to Ms. Sims. The anticipated rental income of 
$278,417 was calculated by multiplying the $343 average 
monthly rent contribution by each of the existing 42 
tenants for 14 months plus the $232 average monthly rent 
contribution by each of the new tenants expected 
beginning in July and increasing each month until the 
program reaches capacity at 104 units, as explained in 
Attachment II provided by DPH. According to Mr. Harry 
Quinn of DRE, under the proposed lease, all 104 units in 
the Windsor Hotel would become available to DPH for the 
Direct Access to Housing Program within ten days of the 
Mayor's and Board of Supervisors approval of the 
proposed lease. 

Comments: 1. The proposed resolution would authorize the Director 

of Property to make any additions, amendments, or other 
modifications to the proposed master lease agreement 
without prior approval of the Board of Supervisors. 

2. The proposed resolution would authorize DPH to 
include in the master lease a clause, in a form approved 
by DRE and the City Attorney, that would indemnify and 
hold harmless the Windsor Hotel, as Lessor, from any 
claims incurred as a result of the City's use of the 
premises. According to Mr. Ted Lakey of the City 
Attorney's Office, these waivers are standard and pose 
minimal additional risk to the City. Mr. Lakey states 
that this provision would require the City to defend and 
pay damages assessed against the Lessor arising out of 
negligence by the City in the performance of the proposed 
contract. Mr. Lakey advises that the City has entered 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

90 



Memo to Finance and Labor Committee 

April 21, 1999 Finance and Labor Committee Meeting 



Recommendation: 



cc: Supervisor Yee 
Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew Hymel 
Stephen Kawa 
Ted Lakey 



into other agreements which include similar 
indemnification provisions and waivers and that the risk 
of additional liability to the City is minimal. 

3. DPH anticipates that there would not be a significant 
number of new tenants for the first two months of the 
lease period from May 1, 1999 through June 30, 1999 
because the Direct Access to Housing Program is a new 
program, and DPH staff needs to inform emergency 
shelters and other transitional housing facilities about the 
availability of the program. The City is required to pay 
the rent for the entire 104 units of the Windsor Hotel, 
even if only 42 units (total number of existing tenants) of 
the total 104 units are occupied. 

Approval of the proposed resolution is a policy matter for 
the Board of Supervisors. 



(f?"?*/ 2 *? 



Harvey M. Rose 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

91 



APR-14-1999 12=46 



DPH H0USIN3 



Draft Windsor Hotel Budget 
April 5, 1999 



415 554 2704 P. 02 

ATTACHMENT I 
Page 1 of 1_ 



Start-Up (May) 



Initial Capital Costs 

Furniture. Equipment &. Reserves 

Maintenance Supplies 

Maintenance & Dam age Deposit 
( Rent 



0.5 



Subtotal 



125,727.00 

3,545.00 

31,200.00 

~62.400.00j 



222,872.00 



On» Yiar 
Budgtt 

(July*99- 

J una '00} 



Operating 
JSCo 

Administrator 
AssL Administrator 
Desk Clerks 
Maintenance Worker 
Asst Maintenance Worker 
Janitor 
Security 
Vac/Sick/Hoi/Em Cov 

Benefits® 17% 

Sub-totals 
Indirect Costs @ 1 .5% 
Total 



1 


5,566.00 


1 


$40,000.00 


1 


4,666.00 


1 


S28.000.00 


4.22 


10,248.00 


4.22 


$61,320.00 


1 


5200.00 


1 


S31 ^00.00 


0.5 


1,820.00 


0.5 


$10,920.00 





0.00 


1 


$18,680.00 





0.00 


1 


$22,000.00 





000 





$0.00 



7.72 



28,600.00 
4,802.00 



33,402.00 
501 .00 



33,903.00 



S212.120.00 

$36,448.00 

9.72 - S248.568.00 

S3.729.00 

S252 297.00 



Credit Reports 

Administrative 

Utilities 

Repairs and Maintenance 

Maintenance & Damage Deposit 

Insurance and Taxes 

Service 

Building Lease 



Start-Up (May) 

660.00 
0.00 
0.00 
0.00 
0.00 
0.00 
QJHL 



0.00 



purnrture, equipment & Reserves 
Subtotal 

Total 



0.00 
660.00 

257.435.00 



One Year 
Budget 

(Jury-99- 
JuneTX)) 

$1,485.00 

$75,436.00 

$63,600.00 

S58.980.00 

$31 200.00 

S32.880.00 

$1200-00 

Sjflb~QcT 

$109,538.00 

$748,719.00 



$1,001,016.00 



GRAND TOTAL OPERATION/ A-L. i L&ASE" COSTS 



1,258,451.00 



TOTAL P. 02 



92 



10 *d THIOL 



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96 



tf 0. ^5V 

l/%\°)\ Citv Hal1 

| ^/z /^ *«MF!fiAA ! Dr - Carlton B - Goodlett Place, Room 244 

M /*«=^¥sa^J^ San Francisco 94102-4689 

Tel. No. 554-5184 



BOARD of SUPERVISORS 



U 



pcy Fax No. 554-5163 

W TDDATTY No. 554^£NTS Ufcr I . 

APR 1 9 1999 

^NOTICE OF SPECIALjDFF SITE MEETINGS g A N FRANCISCO 
^.FINANCE AND LABOR COMMITTEE r- LIBRARY 

Board Of Supervisors f*~.c*n n+ A#-J -/"/*/ 

Notice is hereby given that the Finance and Labor Committee 
of the Board of Supervisors of the City and County of San 
Francisco will hold various special meetings in the 
community to receive public input en the City and County of 
San Francisco 1999-2C00 Budget as follows: 

April 27, 1999; 7 pm-9 pm, Ella Hill Hutch Community 
Center, 1050 McAllister Street; 

April 28, 1999; 7 pm-9 pm, Bayview Police Station, 201 
Williams Avenue; 

April 29, 1999; 7 pm-9 pm, Presidio Middle School, 450 
30 th Avenue ; 

May 1, 1999; 12pm-2 pm, Jean Parker Elementary School, 
84 Broadway; 

May 4, 1999; 7 pm-9 pm, Alvarado Elementary School, 625 
Douglass Street; 

May 5, 1999; 7 pm-9 pm, Newcomer High School, 2340 
Jackson Street; 

May 6, 1999; 7 pm-9 pm, Robert L. Stevenson Elementary 
School, 2 51 34 th Avenue. 

If a quorum of the Finance and Labor Committee members are 
not present, Supervisor Leland Yee will hold a Town Kail 
Meeting for the purpose of receiving community input on the 
City and County of San Francisco 1999-2000 Budget. 



^ 



Gloiria L. Young 
Clerk of the Board 




City and County of £an Francisco 

Meeting Minutes 

Finance and Labor Committee 

Members: Supervisors I. eland Yee, Sue Bierman and Tom Ammiano 
Clerk: Mary Red 



City Hall 

1 Dr. Carlton B. 

Goodlett Place 

San Francisco, CA 

94102-4689 



Wednesday, April 28, 1999 



10:00 AM 
Regular Meeting 



City Hall, Room 263 



Members Present: Leland Y. Yee, Sue Bierman, Tom Ammiano. 



Meeting Convened 

The meeting convened at 10:08 a.m. 

REGULAR AGENDA 



DOCUMENTS DEPT. 

JUN 1 6 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



990667 (Appropriation, Dept. of Building Inspection] 

Ordinance appropriating $1,490,724, Department of Building Inspection, of Building Inspection fund balance 
for professional services and equipment purchases including equipment and upgrades for Y2K compliance and 
improvements to the Department's local area network, for fiscal year 1998-1999. (Department of Building 
Inspection) 

(Fiscal impact.) 

4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst: Frank Chiu. Director, Building Inspection: 
Supervisor Yee: Ed Harrington, Controller: Supervisor Ammiano. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990668 [Appropriation, Planning Department] 

Ordinance appropriating $541,530, Planning Department, for professional services and equipment purchase 
including computer upgrades for fiscal year 1998-1999. (Planning Department) 

(Fiscal impact.) 

4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst: Gerald Green. Director. Cin Planning 

Department: Supervisor Yee. Amended to place $50,000 on reserve for fee analysis. New talc 

AMENDED. 

Ordinance appropriating $541,530, Planning Department, for professional services and equipment purchase 

including computer upgrades for fiscal year 1998-1999; placing $50,000 on reserve. (Planning Department) 

(Fiscal impact.) 

RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at .1.09 PM on 4/79/V9 



Finance and Labor Committee 



Meeting Minutes 



April 28. 1999 



990669 [Appropriation, Dept. of Public Works) 

Ordinance appropriating SI 46, 195, Department of Public Works, for a capital improvement project 

(installation of two traffic signals) to cover ten percent (10%) overage as per Charter Section 7.203, providing 

for ratification of action previously taken, for fiscal year 1998-1999. (Department of Public Works) 

4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Hin Lok Kung. Department of Public Works. 

Harvey Quan, Department of Parking and Traffic. Amendment of the Whole to correct "Charter Section 

7.203" with "Administrative Code, Section 6.6." New title. 

AMENDED, AN AMENDMENT OF THE WHOLE BEARING NEW TITLE. 

Ordinance appropriating $146,195, Department of Public Works, for a capital improvement project 
(installation of two traffic signals) to cover ten percent (10%) overage as per Administrative Code. Section 6.6. 
providing for ratification of action previously taken, for fiscal year 1998-1999. (Department of Public Works) 
RECOMMENDED AS AMENDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



990506 [Appropriation, DPH-Laguna Honda Hospital) 
Mayor 

Ordinance appropriating 56,932,000; 55,810,000 from the General Fund Reserve and 51,122.000 from one- 
time reserve to offset the revenue shortfall for the current year and fund feasibility planning for the 
replacement of the Laguna Honda Hospital for fiscal year 1998-1999. 

(Fiscal impact.) 

3/15/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst: Dr. Mitchell Katz. Director, Department of 

Public Health; Supervisor Ammiano; Supervisor Yee; Supervisor Bierman. Amendment of the Whole 

appropriating $5,599,962, recommended; see also divided File 990861 . 

DIVIDED. 

Ordinance appropriating 55,599,962 from the General Fund Reserve to offset the revenue shortfall for the 

current year of the Laguna Honda Hospital for fiscal year 1998-1999. 

(Fiscal impact.) 

RECOMMENDED AS DIVIDED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



990861 (Appropriation, DPH-Laguna Honda Hospital) 

Ordinance appropriating 51,122,000 from the General Fund Reserve to fund feasibility planning for the 

replacement of the Laguna Honda Hospital for fiscal year 1998-1999. 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst; Dr. Mitchell Katz. Director. Department of 

Public Health; Supervisor Ammiano; Supervisor Yee; Supervisor Bierman. Divided, continued to call of the 

chair; see also File 990506. 

CONTINUED AS DIVIDED. 



City and County of San Francisco 



Printed at 3:09 P\l on 4 ?9 99 



Finance and Labor Committee 



Meeting Minutes 



April 28, 1999 



990671 [SEIU Equity Pay, Fiscal Year 1999-2000] 

Ordinance implementing an agreement adjusting the compensation of certain classifications pursuant to the 
Memorandum of Understanding between the Service Employees International Union, AFL-CIO, Locals 790, 
535 and 250 and the City and County of San Francisco, to be effective July 1. 1999. (Department of Human 
Resources) 

(Fiscal impact.) 

4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee. 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Geoffrey Rothman, Department of Human 
Resources. 

RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990672 [Lease Agreement, Port - Allright Cal„ Inc.] 

Resolution approving lease agreement with Allright Cal.. Inc. and the City and County of San Francisco 
operating by and through the San Francisco Port Commission to operate a surface parking lots at seawall lots 
321, 323, 324 (collectively. Parcel 2) located at Embarcadero. Broadway and Green Streets. (Port) 
4/7/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose. Budget Analyst: Veronica Sanchez, Port: Supervisor 
Ammiano: Supervisor Yee; Jeff Bauer, Commercial Property Manager, Port. Amend on page 1. line 21 by 
deleting "d.b.a. City Parking Company " Same title. 
AMENDED. 

RECOMMENDED AS AMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



99061 7 [Lease of Property] 

Resolution authorizing a 40-year lease of Water Department land between the City and County of San 
Francisco and Cisco Systems, Inc., in Santa Clara County (City of Milpitas). (Public Utilities Commission) 
4/1/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers: Harvey Rose, Budget Analyst; Gary Dow. Public Utilities Commission. 
RECOMMENDED by the following vote: 
Ayes: 3 - Yee, Bierman, Ammiano 



990602 [Redevelopment Agency's Financial/Performance Reports] 
Supervisor Yee 

Hearing to consider the Redevelopment Agency's financial and performance reports for the quarter ending 

December 3 1 , 1998 and a status report on prior year appropriations. 

3/29/99, RECEIVED AND ASSIGNED to Finance and Labor Committee 

Heard in Committee. Speakers Harvey Rose. Budget Analyst; Supervisor Yee; Tiza Peterson. Redevelopment 

Agency. 

FILED by the following vote: 

Ayes: 3 - Yee, Bierman, Ammiano 



City and County of San Francisco 



Printed at 1:10 PV an 4 ?« 10 



Finance and Labor Committee Meeting Minutes April 28, 1999 



ADJOURNMENT 

The meeting adjourned at 1 1:45 a.m. 



City and County of San Francisco * Pri »<' d " ''" «' "" * - g '» 



55V 



TO: 
FROM: 



CITY AND COUNTY 




Public Library, Gov't Information Ctr.. 5 th Fir. 
Attn: Susan Horn, Dept. 41 



OF SAN FRANCISCO 



?£AN 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

1390 Market Street, Suite 1025, San Francisco, CA 94102 (415) 554-7642 
FAX (415) 252-0461 



April 23, 1999 



- Finance and Labor Committee 
.Budget Analyst 



DOCUMENTS DEPT, 

APR 2 7 1999 

SAN FRANCISCO 
PUBLIC LIBRARY 



SUBJECT: April 28, 1999 Finance and Labor Committee Meeting 



Item 1 - File 99-0667 

Department: 

Item: 



Amount: 
Source of Funds: 

Budget: 



Building Inspection (DBI) 

Ordinance appropriating $1,490,724 for professional 
services and equipment purchases for Year 2000 
compliance, including improvements to the Department's 
local area network. 

$1,490,724 

DBI Special Revenue Fund, consisting of fees charged by 
DBI. 

A summary budget for this request of $1,490,724 is as 
follows: 



Professional Services 
Computer Equipment 
Total 



$ 795,615 

695.109 

$1,490,724 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Attachment I, provided by Ms. Amy Lee of DBI, contains 
the budget details and explanations to support this 
request for $1,490,724, including services and software to 
be provided for the $795,615 professional services 
component of the contract, and the equipment to be 
purchased with the $695,109 equipment component of the 
contract. DBI has obtained quotations from three vendors 
who participate in the "City Store" Program 1 overseen by 
the City's Committee on Information Technology- (COIT). 
Attachment I reflects the bid by Computown, the lowest 
bidder. 

Description: This proposed ordinance would appropriate $1,490,724 for 

the replacement of the DBFs network equipment, 
upgrading of software and hardware, and integration of 
DBFs Permit Tracking and Issuance System (PTIS), all 
for Year 2000 compliance. Of this amount, $795,615 is for 
software, professional services for design and installation 
of DBFs local area network and technical support and 
$695,109 is for computer equipment. According to Mr. 
Marcus Armstrong of DBI, Year 2000 compliance work for 
PTIS is due to be completed by October of 1999. 

According to Ms. Lee, Computown Corporate Technical 
Services conducted an audit of DBFs information systems 
in February of 1999 and determined that 67% of current 
information systems supported by DBI would fail as the 
Year 2000 approached. DBI plans to remedy this by 
replacing servers, upgrading and enhancing software, and 
upgrading the network infrastructure. 

DBFs current computer systems and local area network 
houses software that processes permits, schedules 
inspections and tracks complaints about building 
violations. Attachment II provides a description of DBFs 
information systems and their functions. The 

Department of City Planning (DCP) also currently relies 
on DBFs system for access to permit information, address 
verification and property profiles. 



1 A list of pre-qualified vendors for the provision of computer services to City departments that have 
been selected by COIT. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

In addition to remediating Year 2000 compliance issues, 
the requested equipment and software upgrades would 
increase the capacity of DBFs local area network. 
According to Ms. Lee, DBFs network supports far more 
users than it was designed for in 1994, including 
approximately 240 DBI staff and additional staff from the 
Department of City Planning. As a result, there are 
frequent malfunctions and breakdowns, and new 
equipment with greater capacity is needed. Attachment 
III, provided by Ms. Lee, generally describes the capacity 
limitations and the reliability problems of the current 
system. 

Comments: 1. According to Ms. Lee, DBI contacted three vendors 

provided by COIT as part of COIT's "City Store" Program 
for quotations on the work to be performed, and are 
continuing to seek lower costs for the services and 
equipment and software to be provided. The proposed 
amount reflects the lowest bid, submitted by Computown. 

2. According to Ms. Lee, DBI did not evaluate its Year 
2000 equipment and software needs until February of 
1999 because of the lack of an MIS manager to lead the 
effort in the department for a number of months. DBI 
now has an MIS manager. DBI has not previously 
requested any funds for Year 2000 remediation. 

3. The Board of Supervisors previously appropriated 
$500,000 in both FY 1997-1998 and 1998-1999, for a total 
of $1,000,000, for Year 2000 Compliance expenditures. 
These appropriations included expenditures for the City's 
payroll system ($247,000), the Health Sen-ices System 
($186,000), the Mayor's Emergency Telephone System 
($65,000), the Court Management System ($126,000), a 
contract to assess the City's exposure to non-compliant 
chips in vehicles, elevators, medical equipment and other 
devices ($25,000) and various smaller projects ($351,000). 
In addition, the Board of Supervisors appropriated 
$979,000, in January of 1999, to create a Year 2000 team 
to provide technical assistance, monitoring, testing and 
implementation of Year 2000 compliance requirements. 
Therefore, to date, a total of $1,979,000 has been 
appropriated for Year 2000 compliance expenditures. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



4. The table below summarizes total Year 2000 
compliance expenditures to date: 

Fiscal Year 1997-1998 and 1998-1999 

Expenditures SI. 000,000 

January 1999 Supplemental Appropriation 

(File 98-2130) 979,000 

Proposed Supplemental Appropriation 

for the Department of City Planning 

(Item 2, File 99-0668) 491,530 

This proposed Supplemental Appropriation 1.490.724 
Total $3,961,254 

According to Mr. Hymel, any additional requests for Year 
2000 compliance expenditures for other City departments 
will be included in the Fiscal Year 1999-2000 budget. 



Recommendation: Approve the proposed ordinance. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 




Pa^e i of 4 



DEPARTMENT QF BUILDING LNSPECTION 



TO: 
FROM: 

RE: 



City & County of San Francisco 

1660 Mission Street, San Francisco, California 94103-2414 



Honorable Mayor Willie L Brown, Jr. 

Frank ChiiT"^ 



March 8, 1999 



Director, Building Inspection 
Supplemental Appropriations Request 



Recommended Action : 

The Department of Building Inspection is requesting the approval of a supplemental 
appropriation in the amount of SI. 5 million to address the department's information systems 
needs. 

Background : 

Consistent with other computer users, the department is trying to assure that its information 
system complies with Year 2000 requirements. After a thorough audit of our information 
systems, it has been concluded that nearly 67% of our system will fail as the year 2000 

approaches. 

In addition to the problems resulting from Y2K compliance, the DBI Local Area Network 
computer system has experienced numerous failures as a result of our aging network and the 
increase in the amount of users. The current system was installed in 1 994 and has since 
accommodated over 200 users, provided access to multiple city departments and continues to 
provide increased service abilities. 

Analysis/Reason for Recommendation : 

The Department will be requesting approximately SI. 5 million to accomplish the following: 

• Year 2000 Compliance: ensure the operation of our information system after the millenium; 

• Address the degradation of the network by replacing our aging system; 

• Restructure the network to accommodate the growing needs of our users, demands by other 
agencies for access to our databases and the more efficient routing and processing of data. 
We will not only address the complex issues of Year 2000 software and hardware 
compliance for the core network system but also address software copyright compliance 
problems. 



AttachiTier.t I 
fage 2 of U 



After a vendor performed network analysis, and continued discussions with various 
manufacturers and network engineers the recommendation has been made to divide the project 
into the following categories based on implementation priority: 

1. Infrastructure upgrade: Includes repairing and documenting existing cable plant, building 
new wiring closets, and installing a new high-speed network backbone with redundancy 
designed to improve reliability and performance. 

2. NetWare server replacement and operating system upgrade. 

3. Oracle server upgrade: Includes the installation of a new server by Computown and the 
tuning and migration of the applications by DataMine. 

Below, is a summary of the major components of this request: 

Network Infrastructure 

Supplemental Cost: S361.359 

DBI requires implementation of fault tolerant network architecture in order to improve the 
reliability of mission critical applications. Based on the concepts developed by DBI-MIS, Cisco 
has proposed a complex, redundant network design. The Cisco design calls for the installation of 
a Gigabit Ethernet backbone connecting each floor with fiber runs to the server farm in the 
computer room. Switched Fast Esthemet will be run to each workstation on the network. This 
will provide DBI with the network infrastructure that will reliably support all current and 
planned applications into the foreseeable future. Before implementing the Cisco solution, D3I 
will need to modify the cable plant by moving the wiring closets to support new fiber runs 
needed for the proposed high-speed network backbone. 

Appropriations for network infrastructure includes the following items: 

1. Copper Cabling: Estimated 63% need to be replaced: Includes materials (PJ45 Jack, Jack 
housing, 150' CAT 5 Cable, labor, documentation, termination, testing, labeling, demo old 
cables, etc.); 63% of 600 is approximately 375 cables + 50 new cable pulls (just in case) = 
425 cables. 

2. Fiber Cabling. New runs = 5 Fiber Runs (2 drops to the 1* floor, 2 drops to the 3 rd floor, and 
1 drop to 1650 Mission); Pricing includes 12 strand, multimode fiber, connectors, junction 
boxes, inner duct housing, labor, termination, testing, documentation, labeling, etc.). 

3. Patch Cables (3', 7', 15', etc.): Estimated 650 fiber patch cables. 

4. Equipment Racks: 3 new 19" equipment racks (one for each floor- I s , 2 nd , and 3 rd ); 6 new 
19" equipment racks for the server room; Includes all brackets, keyboard trays, monitor 
racks, earthquake kits, floor mounts, nuts, bolts, cable raceways, installation labor, etc.). 

5. Enterprise Switch (CISCO Gigabit Solution): Includes installation of related operating 
software, modules, spare power supply, gigabit equipment, rack mounts, maintenance, etc.; 
also provides for configuration and testing (48 hours). 

6. Segment Switch (CISCO Gigabit Solution with redundancy): Includes related operating 
software, modules, sigabit modules, rack mounts, maintenance, etc.) Total of 5 segment 
switches (I s1 , 2 nd , 3^, 6 th floors and 1 650 Mission); Total of 1 segment switch for the server 
farm (gigabit modules); Installation. 



ALtachment I 
Page 3 or 4 



7. 24 Port Hubs (10/1 00): 4 Hubs for each closet (1 st , 2 nd , 3 rd , and 6 th ), 96 ports plus ports from 
segment switch — gives some room for growth; Installation. 

8. Router for Planning (CISCO): Dual LAN configuration plus firewall; Includes multi-protocol 
software, memory upgrades, rack mount kit, maintenance, etc.). 

9. Emergency Room: 2 Fiber runs; Equipment Rack; Segment Switch. 



Server Room 
Supplemental Cost: S 1 83,750 



DBI needs to replace the existing NetWare servers in order to provide better performance and 
reliability. In addition, the hardware currently in use is not Y2K compliant and cannot be 
upgraded. Appropriations for the server room includes the following items: 

1 . UPS — Battery Backups: Intelligent Matrix Symmetra multi-server battery backup; Includes 
related equipment, parts, and additional battery, Installation and server configuration . 

2. Servers : Production Servers (redundancy, fail over, etc.); New HP Server &. Upgrade 
Minerva; Hardware &. Labor. 

3. Novell Servers: Two servers running Novell 5 providing redundancy and fail over. 

4. Additional Servers: Mail Server, Web Server; Spare Server 

5. Tape Library Backup System: Tape Library system 

Software 

Supplemental Cost: SI 79,0 15 

Presently DBI is not in compliance with current software license agreements, copyright laws and 
Year 2000 software. The outlined list of software upgrades includes the number of seat licenses 
needed to become compliant with software, copyright and license agreements. This is based on 
the number of users of the specified software. The software upgrades will effectively remedy the 
year 2000 compliance issues. Appropriations for Software includes the following items: 

1 . WIN NT 4.0 Server Enterprise Edition: Installation of 10 Servers and 300 Clients 

2. WIN NT 4.0 Workstation: Installation of 30 users. 

3. WIN 98: 270 users and Installation. 

4. MS Office 97 Pro: 50 users and Installation. 

5. MS Project 98: 20 users and Installation. 

6. Corel WordPerfect Suite 8: 75 users and Installation. 

7. Novell Netware 5: 2 servers and 300 clients and Installation. 

8. Lotus Notes/Domino Mail Server and Client: Server and clients; Installation. 

9. Network Management software: Tivoli; T&G. 

Development 

Supplemental Costs: $424,600 



Currently DBI is in the process of developing a Permit Tracking and Issuance System (PTIS). 
The PTIS production software will serve as the backbone of DBI's automated permit tracking, 
complaint tracking, inspection scheduling, district assignments, fee calculation, and permit 
issuance system. The existing network, which PTIS is being developed on will be redesigned 
due to failing infrastructure and servers and various Year 2000 compliance issues. It is 
imperative that the PTIS development team aids in the re-design of the network and continues 
the development of the department's core business production software. Inclusive of the 



Page k or k 

configuration of the proposed production, which includes the integration of the various PTIS 
production modules, the development team will also conduct a workflow analysis. Tne 
workflow analysis is a crucial stage in the implementation of a customer service based network 
such as DBFs. The analysis will speak to how the network should be configured, optimized and 
implemented. Appropriations for Development includes Analysis, Design, Conversion and 
Implementation for the following items: 

1 . Network architecture re-design. 

2. Work-Flow analysis. 

3. Integration of PTIS modules. 

Workstations 

Su pplemental Cos ts: SI 50,000 _ ■ . ■' 

■ ■ Tr_- 

Appropriations for Workstations include new workstations, replacements and upgrades 

Design, Configuration and Implementation 

Supplemental Costs: SI 67,000 

Based on the network analysis conducted by a team of certified network engineers and cabling 
specialists, the department's existing network cabling has a 63% high probability of failure. Tne 
re-design of the existing network will include the correction of the cabling problems and also 
address the location of the cable closets, which are not in properly ventilated or accessible areas. 
Teams of network engineers will be required to implement the network infrastructure, deploy 
servers and install, upgrade, enhance software. Engineers will be used to invoke various network 
protocols and procedures to insure the security, data integrity, backup and full optimization of 
the network. Network engineers will also be used as on site resources for training of staff and 
emergency troubleshooting response. 



1-Year Network Support 

Supplemental Costs: S25,000 ^^____ 

With the onset of potential Year 2000 problems, additional network support may be necessary. 
Therefore should any problems arise, additional network support will provide same day respons: 
for critical failures and 24 hour response for non-critical failures. 



SUPPLEMENT TOTAL: SI, 490. 724 



Fiscal Implications : 

This request does not include any new staff and only appropriates funds for professional services 
and equipment purchases. This request does not include any General Funds and will be solely 
funded by surpluses in our Special Revenue Fund. In addition, this request does not require the 
annualization of any items in this request 



City amd County of San Francisco 
Department of Building Inspection 




Willie Lewis Brown Jr., Mayor 
Frank Y. Chiu, C.B.O., Director 



ATTACHMENT [I 



The Department of Building Inspection's (DBI) information systems provide for a 
multitude of services and functions to the general public, other City departments, and its 
internal staff. The backbone of DBF s information system is its Permit Tracking System. 

The Motorola Permit Tracking System (PTS) permits DBI to provide its primary 
services. The PTS system has several functions: I) complaint tracking system; 2) 
inspector scheduling system; 3) address verification system; 4) permit tracking and 
issuance; and 5) inspector district inquiry. In addition, with PTS, DBFs information 
system provides public reports, city agency and department reports, tax assessor's reports 
and Commission reports. 

Additionally, DBI staff is not the only city personnel who rely on the stability of the 
network system. The Planning Department, along with Department of Public Works, 
Fire Department and Health Department also rely on DBI's information system. 



1660 Mission Street, Sixth Floor - San Francisco, CA 94103 

Office (415) 556-6131 FAX (415) 556-6225 

www.ci.sf.ca.us/dbi • trank_chiuttcLsf.ca.us 



Apr-23-99 1 O : 1 5A 

City and County of San Francisco 
Department of Building Inspection 




Willie Lewis Brown Jr., Mayor 
Frank Y. Cniu, C.B.O., Director 



ATTACHMENT III 



The core of the department's network was implemented approximately eight years ago. 
The Motorola Permit Tracking System has been the core of DBI's business function. The 
Motorola system is experiencing ongoing failures and anomalies. 

DBI's existing critical servers are outdated workstations acting as servers. Tne systems 
clearly cannot handle the ongoing load put on them. Currently, the Department is 
experiencing critical failures at least 4 times a week. This results in at least 6 hours per 
week that DBI does not have to the Permit Tracking System. Additionally, DBI staff is 
also prevented from accessing critical word processing or communication functions. 



1660 Mission Street, Sixth Row - San Francisco, CA 64103 

Office (415) 656-6131 FAX (415) 556-6225 

www.cLs1.ca.us/dbi - frank_chtuttcLsf.ca.us 



10 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Item 2 - File 99-0668 



Department: 
Item: 



Amount: 
Source of Funds: 

Budget: 



City Planning (DCP) 

Ordinance appropriating $541,530 for professional 
services and equipment purchases including (A) $491,530 
for equipment, software and upgrades, all related to Year 
2000 compliance and (B) $50,000 for a comprehensive 
analysis of the Department's fees for service to the public, 
which is not related to Year 2000 compliance. 

$541,530 

DCP Permit Fees. Because of increased permit revenues, 
DCP estimates that it will receive $2.6 million over the 
budgeted fee revenues for FY 1998-99. 

A summary budget for this request of $541,530 is as 
follows: 



Fee Analysis $ 50,000 
Computer Software and Equipment for 

Year 2000 Compliance 491.530 

Total $541,530 

Attachment I, provided by Mr. Costolino Hogan of DCP, 
contains the budget details and explanations to support 
$491,530 of the total request for $541,530, including the 
quantity and cost for each type of software and 
equipment. DCP obtained quotations from two vendors 
who participate in the "City Store" Program 1 overseen by 
the City's Committee on Information Technology (COIT). 
Attachment I reflects the bid from Computown, the lowest 
bidder. 

However, DCP has not yet obtained quotations for the Fee 
Analysis work, and has been unable to provide the Budget 
Analyst with a detailed description of the Fee Analysis 
work or an explanation of the estimated costs for such 
analysis. 



1 A list of pre-qualified vendors for the provision of computer services to City departments that have 
been selected by COIT. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



11 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Description: This proposed ordinance would appropriate $491,530 for 

DCP to purchase and upgrade computer equipment and 
software to remediate Year 2000 compliance issues. In 
addition, because the equipment is state-of-the-art, this 
equipment would allow DCP to better cope with its 
increased permit application workload, update DCP"s 
software licenses and allow DCP to better utilize the 
Department of Building Inspection's (DBI) upgraded 
Permit Tracking and Issuance System. DBI expects to 
complete Year 2000 remediation of the Permit Tracking 
and Issuance System by October of 1999. Attachment I, 
provided by DCP, explains the benefits of the computer 
equipment that will be obtained with the requested 
appropriation. 

The proposed ordinance would also appropriate $50,000 to 
retain a consultant to perform a comprehensive analysis 
of the structure and level of DCP's fees. As discussed 
above, DCP has not yet selected a consultant or obtained 
a quotation for this sen-ice, and has been unable to 
provide the Budget Analyst with a detailed description of 
the Fee Analysis work or an explanation of the estimated 
costs for such analysis. 

According to Mr. Hogan, DCP has experienced a 
significant increase in the amount and complexity of 
permit applications being reviewed, resulting in an 
increase in both workload and fee revenues. Attachment 
II, provided by Mr. Hogan, details the number of 
applications in each of the past three fiscal years, the 
increase in applications, and explains the increase in 
complexity over the same period. As shown on 
Attachment II. there has been a 33% increase in DCPs 
caseload since Fiscal Year 1994-1995, and the average 
hours required to process each application has increased 
18.5% over the same period. 

In addition to remediating Year 2000 compliance issues, 
according to Mr. Hogan. the requested computer 
equipment and software upgrades will allow DCP to 
process permit applications in a more timely and efficient 
manner. Presently, DCP utilizes DBFs local area 
network. Of the proposed $491,530 in software and 
equipment, $222,882 will be spent to create a separate 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

12 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

DCP network, eliminating DCP's reliance on tbe network 
utilized by DBI. 

Comments: 1. DCP will obtain tbe needed equipment from a vendor 

participating in tbe City Store Program. Computown, tbe 
lowest bidder, bas been selected after obtaining 
quotations from two City Store vendors. DCP staff will 
perform tbe installations and upgrades. 

2. As noted above, DCP bas not yet obtained a consultant 
for the fee analysis, and bas not provided a detailed 
description of tbe work to be performed and estimated 
costs. Consequently, the Budget Analyst recommends 
that the ordinance be amended to place $50,000 on 
reserve pending provision by DCP of such additional 
details. 

3. The Board of Supervisors previously appropriated 
$500,000 in both FY 1997-1998 and 1998-1999, for a total 
of $1,000,000, for Year 2000 Compliance expenditures. 
These appropriations included expenditures for the City's 
payroll system ($247,000), the Health Services Sj T stem 
($186,000), the Mayor's Emergency Telephone System 
($65,000), the Court Management System ($126,000), a 
contract to assess the City's exposure to non-compliant 
micro-chips in vehicles, elevators, medical equipment and 
other devices ($25,000) and various smaller projects 
($351,000). In addition, the Board of Supervisors 
appropriated $979,000, in January of 1999, to create a 
Year 2000 team to provide technical assistance, 
monitoring, testing and implementation of Year 2000 
compliance requirements. Therefore, to date, a total of 
$1,979,000 has been appropriated for Year 2000 
compliance expenditures. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

13 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

4. The table below summarizes total Year 2000 
compliance expenditures to date: 

Fiscal Year 1997-1998 and 1998-1999 

Expenditures $1,000,000 

January 1999 Supplemental Appropriation 

(File 98-2130) 979,000 

Proposed Supplemental Appropriation for 

Department of Building Inspection 

(Item 1, File 99-0667) 1,490,724 

This proposed Supplemental Appropriation 

(less $50,000 for the proposed fee analysis) 491.530 

Total $3,961,254 

According to Mr. Hymel, any additional requests for Year 
2000 compliance expenditures for other City departments 
will be included in the City's Fiscal Year 1999-2000 
budget. 

Recommendation: 1. In accordance with Comment No. 2, amend the 

proposed ordinance to reserve $50,000 pending provision 
by DCP of a contract and budget details for the proposed 
fee analysis. 

2. Approve the proposed ordinance as amended. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

14 



Attachnent I 
Pase 1 of 4 



PLANNING DEPARTMENT SUPPLEMENTAL COMPUTER NEEDS, 
RSCAL YEAR 1998-99 BY CATEGORY 



No. 



Descriation 



I Unit Cost | Tax | Total Cost I 



Rationale/Comments 



IPCs 



43 



PCs with departments 
standard PC configuration: 
HP Vectra Series 8 5/450 
MHz Pentium II processor, 
123 M3 memory, 10 G3 hard 
drive, 100 Mbs twisted-pair 
network card, Windows 95 
(S2.162) and HP Ergo 1280 
1 7" monitor (S528) 



S2.SS0 



S229 



S125.502 



Existing PCs being replaced are 
not Year-2000 compliant and are 
inadequate to run today's 
programs: upgrading these PCs 
is infeasible; this is now 
Microsoft Windows 2000 
suggested hardware 
requirement (See attached) 



PCs with departments power 
PC configuration: HP Kayak 
XA-S with Pentium III 500 
MHz processor. 128 MB 
memory, 10 G3 hard drive, 
1 00 Mbs twisted-pair network 
card. Windows 95 (S3.277). 
and HP Ergo 1280 17* 
monitor (S528) 



S3.79S 



S323 



S37.063 



This is the departments power 
user configuration. See 
attached information for 
rationale) 



fOs witn aepanmenrs targe- 
monitor power PC 
configuration: HP Kayak XA-S 
with Pentium III 500 MHz 
processor, 128 MB memory, 
10 G3 hard drive, 100 Mbs 
twisted-pair network card, 
Windows 95 (S3.277), 
speakers and HP P 1 1 1 21 " 
monitor (Si, 223) 



S4.501 S383 SI 9.534 



This is the departments power 
user configuration. However, 
these five PCs are gSee 
attached information for 
rationale) 



| SI 82.1 04 1 



| Network Equipment 



Server. Main and Oracle 
servers replaced with servers 
configured with the following: 
Dual (2) Pentium II 450 MHz 
Xeon processors, 1 GB of 
memory, 218 G3 of disk 
storage space, and 4 high- 
speed PCI NICs (network 
interface cards) 



S35.741 S3.038 



S77.558 



New servers will be able to 
handle Microsoft NT Server and 
handle increased network traffic, 
accommodate storage space 
needs and address year 2000 
compliance; existing servers will 
replace other department 
servers 



Replacement of existing fax 
servers and update number of 
fax lines from 4 to 8 



S10278 



S374 



S11.152 



Lotus Domino 4.5 Server or 
later 



SI, 875 



S159 



S2.C34 



Domino server is the City's 
standard in work group and 
workflow software; it will also be 
the platform for the departments 
Intranet; this money work 
ordered to DT1S 



N:\OA SIS-&900PROCJCL 5 



10f4 
15 



V2W99 5:1* PM 



Attachment 
Page 2 of ' 



No. | DescnDVon 1 L/n/f Cost \ Tax 1 7o:a/ Cos: 1 Rafcona/e/Commffnts 


• i i 


2 


_otus Domino Server and 
messaging administration and 
Motes application 
development classes 


SI .500 

1 


SO 


S3.200 


Notes will soon oe replacing 
cc:Mail as the department's e- 
mail software; we need to send 
someone to class to learn how to 
administer this software: this 
monev worn oraered to DTIS 


3 


Smart-UPS 3000 
(Uninterrupted Power Suppry) 
for new server, Oracle server, 
and switch 


SI. 500 


S125 


S5.208 


UPS will proviae our nerworx 
with continuous power and 
protection to server in the event 
of a power suroe or outace 


1 


Backup unit DLT/4 (Digital 
Linear Tape) tape backup unit 
capable of backing up both 
NetWare and NT servers: unit 
should be able to handle up 
to 12 tapes in one (1) tray 


S47250 


S-i.015 


SSI .255 


Easting backup aevica can no 
longer efficiently bacxup the 
department's information 
because o( the network's vastly 
increased storage caoacty and 
the fimitations of the current 
tecnnoiocrv 


1 


HP ProCurve Smartswitcn 
switch per the attached 
specifications: 


S54.5E3 


S4.5-10 


253 223 


Switcn will become the pnmary 
department switch and contain 
mixture of Fiber Optic and RJ-43 
modules, and ran entire nerworx 
at Fast Ethernet speeds: existing 
switcn will be traced in for creci! 
to reduce the cost 


1 


DTIS Router purchases, 
installation and setup (or 
point-to-point T-1 line 
connection (DTIS estimate! 


S7.C80 


SO 


S7.080 


One-time cost lor purchase c( 
two routers, installation and 
setup of routers lor T-1 Dne: this 
monev worx ordered to DTIS 


1 


Nerworx i_an Anaiyzer mat 
would need to function in both 
a fiber optic and PJ-45 
environment 


SS.579 


S4E3 


S5.-.62 


Analyzer will assist m 
monitonng, analyzing, and 
isolating LAN problems, 
environment 


S222.8S2! 




| Software 


1 


Backup software to run on the 
new backup device 


S3.750 


S319 


S4.059 


New backup software will be 
required that can handle the 
dicital linear taoe teennoioov 


1 


Pacific Bell installation of a 
secure leased dedicated T-1 
line (DTIS estimate) 


SI .500 


S135 


SI .735 


installation cost of the aeocatec 
T-1 telephone line; ( lor speecs 
< T-1 . monthly cost is S390); 
money paid to Pacific Bell from 
the departments teiepnone 
budcet 


1 


Upgrade Novell NetWare 150 
user Rcenses to NetWare 5.0 
200-user licenses (see quote) 


S7.122 


S5C5 


S7.727 


New nerworx operating systems 
licensing will bnr.g Planning into 
compliance with the newest 
versions of the software we 
already use: eacr. server neecs 
the correct number of user 
licenses 



N:\OASISW900PnOC.XLS 



2of-i 

16 



4.7.CS9 £.'•* PM 



Attachment I 
Paee 3 of 4 





No. | Descriotjan | Unit Cost\ Tax 1 Total Cost\ Rationate/Commenzs 




■ i < • 




200 r 

1 


Microsoft NT 4.0 Client 
censes MOL-3 (see quote) 


S29 


S2 


S6.293 


New network operating systems 
licensing win bnng Planning into 
compliance with the newest 
versions of the software we 
already use; each server needs 
the correct number of user 
licenses 




25 


Microsoft Office 97 Standard 
or later) licenses (see 
attached quote) 


S379 


S32 


S14.393 


Office 97 (Microsoft Word, Excel, 
etc.) win be replacing the 
WordPerfect suite of products 
(WordPerfect, Quattro Pro, etc.); 
35 is the estimated maximum 
no. of concurrent users we might 
have on these programs at one 
time 




5 


Microsoft Office 97 
Professional (or later) 
licenses - Same as above 
except with Access 97 (see 
attached auote) 


S448 


S38 


S2.430 


Office 97 (Microsoft Word, Excel, 
etc) wiD be replacing the 
WordPerfect suite of products: 5 
is the estimated number of 
Access users 




20 


Oracle license purcnase 
(quote from DTIS) 


S825 


SO 


S16.500 


Oracle licenses are required to 
use Orade; it is licensed based 
on a formula for concurrent use; 
this would add 25 users to our 
already existing 5 users; this 
money wfll be work ordered to 
DTIS 




2 


Delphi 4 (one new copy and 
one upgrade from 3.0) 


S1.599 


S144 


S3. 587 


Delphi is the software used by 
the OASIS programmers; we 
need to add an additional license 
to the current one because we 
have two programmers 




5 


ArcView 


S795 


S58 


S4.313 


Arc v /iew is the GiS software tne 
department uses; additional 
Dcenses are needed because 
more Deoole are usino GIS 




120 


Lotus Notes client (pnce from 
DTIS) (DTIS quote) 


S38 


SO 


S4.560 


Notes will soon be replacing 
crMail as the department's e- 
mai) software; in addition, this 
software will facilitate group 
scheduling, group task 
assignments, etc; this money 
work ordered to DTIS 






SS5.708| 








|Other Equipment 




1 


Additional Pentium Pro 
processor (SI .801) and 512 
MB of additional memory 
(S3.258) for existing file 
server 


S4.50S 


3 S3e: 


i S4.89; 


! Neeaed for new Domino server 
wnicn is existing file server 




1 


HP DesignJet 1050CM color 
plotter (see attached letter) 


S7.59 


5 SS5 


J S3.34 


3 Plotter would the color plotter 
that we are renting currently tor 
S395 oer month. 






1 


I 


I 


| S13.24 


'! 



N:\OASIS-i9S00PROCXLS 



4."20/99 5. '•< PM 



17 



Attachner it I 
Page U of k 



No. 


Descnation 


Unit Cast 


Tax 


7oa/ Cos: 


F.otionaie/ Comments 






ITraining 


1 


ArcView Avenue scnpting 
class 


SI. 000 


S25 


ST. 085 


Class :o neiD us aeveiop G:S 
programs spec-.fically for 

P'.ar.ninc 


3 


NT training for OASIS (5 x 
S1200) 


Si. 200 


S1C2 


S6.510 


Training for 0AS:S star! on 
future network system usee ov 

D3l 


I S7.595I 






1 VJ 1 ML. 






S491.531 


I 



N:\OASlSi9900PROC.XLS 



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19 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Item 3 - 99-0669 



Department: 



Item: 



Amount: 
Source of Funds: 

Description: 



Department of Public Works (DPW) 
Department of Parking and Traffic (DPT) 

Supplemental appropriation ordinance in tbe amount of 
5146,195 to fund construction cost overruns, in 
accordance with Section 6.6 of the Adniinistrative Code, 
associated with the installation of traffic signal lights at 
eight intersections throughout the City, providing for 
ratification of actions previously taken. 

$146,195 



Previously appropriated Proposition B Sales Tax 
funds 



Bond 



According to Ms. Carol Finucane of the Department of 
Public Works (DPW), on November 24, 1998, DPW 
awarded a construction contract, in the amount of 
$452,400, to Millard Tong Construction through a 
competitive bidding process for the installation of tr affi c 
signal lights at eight intersections throughout the City. 
Attachment I, provided by DPW, contains a list of the 
locations of these eight intersections. 

In September of 1998, the Board of Supervisors approved 
a resolution (File No. 98-1515) urging the Department of 
Parking and Traffic (DPT) to install traffic signal lights at 
the intersection of Geneva Avenue and Madrid Street. In 
addition, according to Ms. Finucane, to date, various 
neighborhood groups, located near Geneva Avenue, have 
requested DPT to install traffic signal lights at the 
intersection of Geneva Avenue and Paris Street. Ms. 
Finucane advises that DPW intends to modify- its existing 
contract with Millard Tong Construction for Millard Tong 
Construction to install traffic signal lights at the 
intersection of (1) Geneva Avenue and Madrid Street and 
(2) Geneva Avenue and Paris Street in order to improve 
traffic and pedestrian safety at these two intersections. 
This proposed contract modification would result in a 
total revised contract amount of $643,735, which is 
$191,335 (including $146,195 in contract modification 
costs and $45,140 in contract contingency costs) or 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

20 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



Budget: 



Comment: 



approximately 42 percent over tbe original contract bid of 
$452,400. 

Ms. Finucane states that DPW intends to pay for this 
contract modification of $146,195 from previously 
appropriated Proposition B Sales Tax Bond funds. 
However, because Section 6.6 of the Administrative Code 
requires that expenditures of more than 10 percent above 
the estimated amount of the original contract be 
authorized by a supplemental appropriation, DPW now 
requires approval from the Board of Supervisors of this 
proposed supplemental appropriation ordinance. 

Attachment II, provided by DPW, contains a cost 
breakdown in the amount of $146,195 to support the 
proposed contract modification. 

Mr. Ted Lakey of the City Attorney's Office states that 
this ordinance incorrectly references Charter Section 
7.203. The correct reference is Section 6.6 of the 
Administrative Code. Therefore, the title of the proposed 
ordinance should be amended to substitute Section 6.6 of 
the Administrative Code for Section 7.203 of the City's 
Charter. 



Recommendation: 



1. In accordance with the Comment above, amend the 

title of the ordinance to substitute Section 6.6 of the 

Administrative Code for Section 7.203 of the City's 
Charter. 



2. Approve the proposed ordinance as amended. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 

21 



Attachment I 



1. Tamaipais Street and Turk Street 

2. Eddy and Divisadero Stress 

3. 30 th and Dolores Stress 

4. Spear and r oisom Stress 

5. 20 th Avsnue and Winston Drive 

6. US Postal Process and Distribution Center - 1300 Evans Avenue 

7. Fremont and Folsom Stress 

8. Lake Merced Boulevard and MiddleSeld Drive 



22 



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25 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Item 4 - File 99-0506 



Amount: 



Source of funds: 



Department: Department of Public Health (DPH) 

Laguna Honda Hospital (LHH) 

Item: Supplemental appropriation ordinance appropriating 

$6,932,000 to Laguna Honda Hospital for: a) a projected FY 
1998-99 revenue shortfall of $5,810,000; and, b) $1,122,000 for 
feasibility planning to determine options to replace the Laguna 
Honda Hospital. 

$6,932,000 

The source of funds for the projected FY 1998-99 revenue 
shortfall of $5,810,000 would be the General Fund Reserve. 
The source of funds for the remaining $1,122,000 of the 
proposed supplemental appropriation for feasibility planning 
for the Laguna Honda replacement Hospital would be a 
previously established a General Fund reserve designated for 
one time purposes. The reserve designated for one time 
purposes was established in FY 1995-96, when the Controller 
recommended and the Mayor and the Board of Supervisors 
concurred that $16.8 million in one-time revenue received from 
a change in the method of accounting for Sales Tax and Motor 
Vehicle In Lieu Tax revenue be placed on reserve and used 
only for capital or other projects that need one-time infusions 
of funds. Since that time, specific project appropriations have 
been made from this ongoing one-time reserve, and the present 
reserve balance is $2,912,000. If the proposed supplemental 
appropriation of funds from this reserve in the amount of 
$1,122,000 is approved, the balance in this one-time reserve 
fund would be $1,790,000. 

Description: DPH Justification for the Proposed 

Supplemental Appropriation 

According to a March 2, 1999 memorandum submitted to the 
Finance and Labor Committee by Dr. Mitchell Katz, Director 
of Health, a supplemental appropriation is necessary to 
respond to requirements imposed on Laguna Honda Hospital 
by the U.S. Department of Justice (DOJ), the State 
Department of Health Services and the State Health Care 
Financing Agency. This supplemental appropriation will allow 
LHH to address deficiencies identified by these regulatory 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



26 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 

agencies and would enable LHH to comply with requirements 
contained in the LHH "Plan of Correction", a formal agreement 
between DPH and the U.S. DOJ. 

A summary of the requirements imposed on LHH by the Plan 
of Correction is provided in Attachment 1 to this report. 

The total LHH projected revenue shortfall is $7,765,192, offset by expected 
expenditure savings of $1,955,192. Therefore, DPH estimates that the LHH 
anticipated deficit is $5,810,000 for FY 1998-99. 

According to the March 2, 1999 memorandum from Dr. Katz, 
LHH is experiencing a revenue shortfall as a direct result of 
the Plan of Correction's imposition of a reduced patient census. 
The FY 1998-99 budget included revenue reimbursement 
estimates based on an average daily patient census of 1,166. 
The Plan of Correction required that the average daily census 
be reduced to 1,065, a reduction of 101 patients per day or 8.7 
percent less than the budget assumption. Consequently, Medi- 
Cal and Medicare revenues have declined in relation to the 
reduced census. 

The table below shows the current LHH budgeted revenue, 
projected revenue and projected deficit, by revenue account, for 
FY 1998-99. This projection was prepared by LHH and 
provided to the Budget Analyst by Ms. Monique Zmuda, Chief 
Financial Officer for the Department of Public Health 

Projected FY 1998-99 Revenue Shortfall - Laguna Honda Hospital 

Current Revised Revenues Realized Total 

FY 1998-99 through January 31, Projected Revenues Estimated Surplus 



Revenue Source 


Budeet 


1999 


for FY 1998-99 


(Deficit) 


Medi-Cal 


S 87.839,439 


S 47,503,433 


S 80.496.311 


Si". 343. 128) 


Medicare 


4,527.090 


2.233,189 


3,435,866 


(1,091.224) 


Patient Revenues 


6,477,884 


4.267,624 


7,182.354 


704,470 


Miscellaneous 


325,000 


143.565 


289.690 


(35.310) 


State Realignment 


673.637 


392.955 


673.637 


- 


General Fund Support 


22.099.125 
S 121,942,175 


12.633.772 
5 67,174,538 


22.099.125 
S 114.176,983 


. 


Total 


5(7,765.192) 



The table below, also provided by Ms. Zmuda, presents the 
LHH projected actual expenditures for FY 1998-99. This 
projection results in an estimated savings of SI. 955. 192. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



27 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 

Projected FY 1998-99 Expenditure Savings - Laguna Honda Hospital 





Current Revised 


Expenditures 


Total Projected 






FY 1998-99 


through February 


Expenditures for 


Estimated Surplus 


Expenditure 


Budget 


28, 1999 


FY 1998-99 


(Deficit) 


Salaries 


$ 81,443,656 


$51,690,866 


$ 80,127,621 


$ 1,316,035 


Fringe Benefits 


20.505.456 


12.869.042 


20.205.456 


300.000 


Subtotal - Personnel 


$ 101,949,112 


$ 64,559,908 


$ 100,333,077 


$ 1,616,035 


Contractual Services 


S 3,450,728 


$ 1,882,439 


$ 3,525,728 


$ (75,000) 


Materials and Supplies 


7,793,973 


5,939,912 


8,143,973 


(350,000) 


Equipment 


1,647,829 


791,122 


1,397,829 


250,000 


Services of Departments 


4,043,533 


2,523,958 


4,673,376 


(629,843) 


Capital Projects 


3.057.000 


1.275.333 


1.913.000 


1.144.000 


Total 


$121,942,175 


$ 76,972,672 


$ 119,986,983 


$ 1,955,192 



The LHH projected revenue shortfall of $7,765,192, offset b}- 
the estimated expenditure savings of $1,955,192 results in the 
estimated net revenue shortfall of $5,810,000. 

DPH is requesting $1,122,000 for the one time cost of conducting feasibility 
planning for a Laguna Honda Hospital replacement facility 

According to the March 2, 1999 memorandum by Dr. Katz, the 
DPH is requesting $1,122,000 to begin financial feasibility 
planning necessary to replace Laguna Honda Hospital. This 
request includes funds for DPW project management, site 
assessment, architectural and engineering consultation, City 
Attorney and City Planning fees, community planning, and 
hospital financial and strategic planning. Attachment 2, 
provided by Dr. Katz, details the request for $1,122,000. This 
request is summarized below. 

Summary Budget for LHH Replacement Feasibility Planning 

DPW costs $265,800 

Other City Departments 167,500 

Consultants 688.700 

Total $1,122,000 



Consultants have not been selected for the proposed 
expenditure of $688,700 shown in the table above. According to 
Ms. Zmuda, the consultants will be selected on a competitive 
basis with the exception of a $48,000 contract for financial 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

28 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 



analysis of operations that will be granted to a firm that 
specializes in long term care health facilities and has 
performed similar work on past Laguna Honda Hospital 
Replacement plans. This firm, Health Financial Solutions, is 
expected to be selected on a sole source basis because of its 
specialization and past experience with the planning process 
for replacement of Laguna Honda Hospital. 

On April 20, 1999 a report prepared by the Laguna Honda 
Replacement Planning Committee was presented to the Health 
Commission. The Laguna Honda Replacement Planning 
Committee (LHRPC) is comprised of 26 City officials and 
private citizens and co-Chaired by the City Attorney and the 
Director of Public Health. The City Attorney was appointed to 
lead the planning effort for the Laguna Honda Replacement 
Hospital by the Mayor. As co-Chairs, the City Attorney and the 
Director of Public Health selected members of the LHRPC. The 
LHRPC has recommended a demolition of the current LHH 
main hospital and remodeling of Clarendon Hall to provide a 
facility that will accommodate a total of 1.200 beds. The 
LHRPCs estimate of the total cost of the replacement project 
is $428,707,000. The LHRPC recommends Health Commission 
and Board of Supervisors approval of the proposed project and 
the submission of a General Obligation Bond measure to the 
voters in the November, 1999 election. The amount of the 
proposed General Obligation Bond measure would be 
approximately $437,000,000 to cover the project cost of 
$428,707,000 and bond issuance costs of approximated 
$8,300,000. 

The LHRPCs report also recommends that Tobacco settlement 
proceeds due to the City, which the LHRPC estimates wiD 
range from $313,400,000 to $442,100,000 over the next 25 
years, be used as a source of funds to offset the cost to property 
owners for repayment of the General Obligation Bonds. Ms. 
Monique Mover, Mayor's Director of Public Finance, estimates 
that the total debt service for the proposed $437,000,000 
General Obligation Bond would be approximately 
$846,900,000 over 25 years. Therefore, if the LHPC's 
recommendations are approved. Tobacco settlement proceeds 
would pay for an estimated 37 percent to 52 percent of the 
total debt service. 

According to Ms. Zmuda, advantage to beginning the planning 
work, prior to voter approval of the General Obligation Bond 

BOARD OF SUPERVISORS 
BUDGET ANALYST 

29 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 



Analysis 



measure, is to reduce future project escalation costs because 
six months will be saved on tbe project timeline, according to 
Ms. Zmuda. The advance planning will also provide voters 
with more information on which to make a decision of the 
proposed General Obligation Bond measure. 



The Budget Analyst has reviewed the LHH projected revenue 
shortfall in detail and concurs with the projection of reduced 
revenue. 

DPHs estimated expenditure savings of $1,955,192 shown 
above includes savings of $1,316,035 for Salaries and S300,000 
for Fringe Benefits, for a total savings of $1,616,035 for 
personnel-related accounts. However, the Controller's latest 
monthly expenditure projections for Laguna Honda Hospital, 
based on actual payroll and fringe benefit expenditures 
through the pay period ending March 19, 1999, estimate total 
expenditure savings of $1,997,926 for Salaries and savings of 
$342,876 for Fringe Benefits. The Controller's projected 
savings for personnel-related accounts therefore totals 
$2,340,802 or $724,767 more than the DPH projected 
personnel-related savings of $1,616,035. 

However, the Controller's projected savings does not include 
new positions that have been hired since March 19, 1999. The 
Mayor's Office of Finance has approved filling 16 personnel 
requisitions for existing authorized positions, including 10 new 
positions that were approved for partial year funding in the FY 
1998-99 budget for a new Medical Psychiatric Unit and six 
additional authorized positions that have been held vacant. 
These positions have been filled. LHH also intends to hire 11 
additional positions to meet a U.S. DOJ recommendation that 
LHH staff a Training Team to address staff development 
requirements and improve patient care. Lastly, the LHH FY 
1998-99 budget includes overtime funds for additional 
personnel during the State Accreditation Survey to be 
conducted during the month of May that will result in 
increased spending that was not included in the Controller's 
projections. 

The Budget Analyst has reviewed the LHH projected 
expenditures for the remainder of the Fiscal Year. Based on 
this review, we conclude that the LHH projected personnel- 
related expenditure savings of $1,616,035 will increase by 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

30 



Memo to Finance Committee 

April 14, 1999 Finance and Labor Committee Meeting 

$210,038 to $1,826,073. Therefore, the proposed supplemental 
appropriation should be reduced by the amount of $210,038. 

Comment: Because the proposed expenditure of $1,122,000 for feasibility 

planning for the proposed Laguna Honda replacement 
Hospital would begin preliminary work on the project before 
the proposed General Obligation Bond measure a) is 
authorized by the Board of Supervisors and b) is actually 
approved by a two thirds vote of the electorate, the approval of 
this portion of the supplemental appropriation is a policy 
matter for the Board of Supervisors. 

Recommendation: 1. Reduce the proposed supplemental appropriation related 
to the LHH anticipated deficit portion of the request by 
$210,038 from $6,932,000 to $6,721,962 to reflect the revised 
expenditure requirements for the remainder of the Fiscal Year. 
The amount to be funded from the General Fund Reserve 
would therefore decrease by $210,038 from $5,810,000 to 
$5,599,962. 

2. The proposed expenditure of $1,122,000 from a previously 
established General Fund reserve to perform feasibility 
planning for a proposed Laguna Honda Replacement Project 
prior to a) authorization of the necessary General Obligation 
Bond measure by the Board of Supervisors, and b) prior to 
approval by a two thirds vote of the electorate, is a policy 
decision for the Board of Supervisors. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



31 



)jty and County of San Francisco Department of Public Health 

Laguna Honda Hospital 




Ken Bruce 

Board Budget .Analyst 

Fox Plaza 

1390 Market Street, Suite 1025 

San Francisco, CA 94102 

Re: LHH Supplemental Appropriation 

Dear Mr. Bruce: 

The following memo is being sent to you at the request of Anne Okubo. It outlines the 
impact of regulatory- requirements on Laguna Honda Hospital in three areas which are 

identified. 

I. Census Reduction 

Projected revenue short fall for Laguna Honda Hospital is a direct result of 
reduced patient census. The current fiscal year operating budget assumes 
revenue reimbursement for 1 166 patient beds. As a requirement of the Plan of 
Correction imposed by the State (Licensing &. Certification) and Federal 
(Healthcare Financing Administration) regulatory agencies, patient census in the 
Hospital has been reduced to 1065. As a result, MediCal revenues are projected 
to be $6.90 million under budget and MediCare revenues are projected to be 
SI. 09 million below budget. This is partially offset by SO. 54 million surplus in 
other revenues resulting in a net revenue short fall of S7.45 million. Laguna 
Honda Hospital is requesting S5,8 10.000 to offset the projected revenue loss 
associated with these regulatory requirements. 

Attached is Laguna Honda Hospital's Plan of Correction (dated July 8, 1998). 
Referring to Page 2, under phase I, Laguna Honda Hospital committed to 
reducing the resident census by 4 beds in each of 28 wards in the main hospital 
building and by 2 beds in one ward, for a total reduction of 1 14 beds. 

Also, attached is a table with Laguna Honda Hospital's Average Daily Census 
by month for this fiscal year. 

EL. Wardrobe Cabinets 

As part of the Plan of Correction with the State (Licensing & Certification) and 
Federal (HCFA) agencies, wardrobe cabinets were installed where the beds had 

5)664-1580 375 Laguna Honda Blvd. 32 San Francisco, CA 94116 



Attachment 1 
Page 'I or 2~" 



been vacated. These wardrobe cabinets provide additional privacy and provide 
the residents with immediate access to their belongings. Laguna Honda initiated 
this project with OSHPD (State of California) in July 1998. Laguna Honda 
Hospital received approved drawings and a building permit from OSHPD on 
December 17, 1998. Laguna Honda Hospital had completed the public bid 
process for the wardrobe cabinets and was only awaiting the design to be 
approved before releasing the contract to fabricate these units. The purchase 
order was finalized in early January 1999. The wardrobe contract was awarded 
for a total cost of $573,921.60. The wardrobe installation began 
February 1,1999. There were 972 wardrobes installed in 33 wards. The work 
was completed on March 24, 1999. 

m. Therapy Staff 

In the DOJ Findings Letter of May 6, 1998, reference is made to minimum 

remedial measure #3b: 

"Conduct adequate assessments of the specialized rehabilitative needs of 
residents (including speech, occupational, and physical therapy services), 
and ensure that needed services are provided in a timely manner by 
qualified staff." 

In response to this finding, each therapy department (PT, OT. ST) at Laguna 
Honda Hospital hired one additional therapist in the last quarter of 1998. 

Please contact me at 759-2363 should you have questions or need additional 
information. 

Sincerely, 

jJm^ to. J^U^ 

George Fribance 
Associate Administrator 

GF:jf 
Attachments 



Larry Funk 
Larry Kuester 
Anne Okubo 
Monique Zmuda 



33 



Attachment 2 



LAGUNA HONDA HOSPITAL REPLACEMENT PROGRAM 
BUDGET DETAIL 



DESCRIPTION AMOUNT SUBTOTAL TOTAL 



DEPARTMENT OF PUBLIC WORKS 



Programming and Management 

Project management & technical support S205,800 

Environmental Engineering (Hazardous Materials) 

Bureau of Construction Management - Site Assessment and Remediation 5,000 

Site Constraint & Environmental Analyses 

Analyst & technical support 50,000 

Geographic Information Systems 

Office of Capital Resource Management 5,000 



S265.800 



OTHER CITY DEPARTMENTS 



Department of Real Estate 

Appraisals, consultation for budgeting relocations $ 1 5,000 

City Architect 

City Architect and staff 80,000 

Public Utilities Commission 

Utilities Engineering Bureau, Hetch Hetchy Water & Power - Consultation 5,000 

for budgeting &. planning utilities 

Department of City Planning 

Office of Environmental Review - Environmental Evaluation Fee 65,000 

Department of Telecommunications & Information Systems 

Consultation for budgeting telecommunications / data lines 2,500 



S167.500 



CONSULTANTS 



Architecture & Engineering 

Architecture, structural / mechanical / electrical engineering, cost estimating, 5285,300 

scheduling, renderings, models, plots, photography, graphic design, printing, 

peer reviews, value engineering, public outreach, community planning & 

meeting forums 

Environmental Engineering 

Hazardous Materials assessments & abatement estimating 18.000 

Site Reports & Environmental Analyses 

Site & utilities assessment report, traffic study, biological resources report, 285,400 

site surveys, environmental analyses reports for DCP, soils borings. 

geotechnical report, historic preservation reports 

Financial Consultants 

Research and financial analysis of potential funding sources (Medi-Cal 100.000 

AB1732, State funds and Tobacco Settlement), financial analysis of revenues 

and operating expenses for replacement facility 

S(»S8.700 

total si.i2:.ooo 



L:\SUPLMNTL\-ME000O4jiIs 4/23/99 

34 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



Item 5 - File 99-0671 

Department: 

Item: 



Department of Human Resources (DHR) 

Ordinance implementing tbe provisions of an amendment 
to tbe Memorandum of Understanding (MOU) between 
tbe Service Employees International Union (SEIU), AFL- 
CIO, Locals 250, 535 and 790 and tbe City and County of 
San Francisco to provide for tbe continuation and funding 
of a pay equity program for qualified SEIU classifications 
in FY 1999-2000. 



Description: 



In June of 1997, tbe Board of Supervisors approved an 
MOU (File No. 93-97-46) witb tbe Service Employees 
International Union (SEIU), AFL-CIO, Locals 250, 535 
and 790 for the three-year period from July 1, 1997 
through June 30, 2000. The MOU covers 405 
Miscellaneous classifications comprising a total of 
approximately 10,000 employees. 

Section 37 of the MOU provides for the funding of a pay 
equity program for qualified SEIU classifications with 
funding of up to $2 miUion in FY 1997-98 and up to $1.5 
milhon in FY 1998-99. The MOU also provides for an 
evaluation of the conditions under which the program is 
to continue for the last year of the agreement, FY 1999- 
2000. However, no specific funding amount was included 
in the MOU for FY 1999-2000. The MOU states that, "The 
City and the Union shall jointly conduct a mutually 
agreeable study to assess the Pay Equity program and to 
ensure that the program is effectively meeting its goals. 
The study shall be concluded no later than December 1, 

1998. This contract shall be reopened effective July 1, 

1999, pursuant to the provisions of Charter Section 
A8.409, solely on the issue of determining the appropriate 
conditions under which the Pay Equity program should 
continue, if any." 

According to Ms. Alice Villagomez of DHR, the required 
study to assess the Pay Equity program was performed 
and for the last year of the MOU, FY 1999-2000, the City 
and SEIU have agreed upon pay equity adjustments of 
.25 percent to .50 percent for ehgible classifications. 
Under the proposed ordinance, a total of 100 

BOARD OF SUPERVISORS 

BUDGET ANALYST 



35 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



classifications would be eligible for such pay adjustments. 
A fisting of the classifications and the proposed pay 
adjustments for each are shown on Attachment I, 
provided by DHR. 



Comments: 



1. Ms. Villagomez advises that the intent of the Pay 
Equity program is to make pay adjustments for classes in 
occupations which have historically been occupied by 
women and minorities. According to Ms. Villagomez, the 
criteria used for the Pay Equity program are 
classifications which are comprised of 70 percent or more 
women and/or minorities who earn less than $45,000 
annually and are deemed to be undervalued compared to 
similar jobs occupied by non-minority males. 



2. According to the Controller's Office, the 100 
classifications subject to the proposed ordinance cover 
5,392 filled positions. As shown in Attachment II. 
provided the Controller's Office, implementing the 
proposed ordinance would result in estimated increased 
costs to the City of approximately $1,122,000 m FY 1999- 
2000. The Budget Analyst concurs with the Controller' 
estimate. 

3. According to Mr. John Madden of the Controller's 
Office, such additional funds of approximately $1,122,000 
will be included in the City's FY 1999-2000 annual 
budget. 



Recommendation: 



Approval of the proposed ordinance is a policy matter for 
the Board of Supervisors. 



BOARD OF SUPERVISORS 

BUDGET ANALYST 



36 



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Attachment I 




39 




I CITY AND COUNTY OF SAN FRANCISCO 



Attac'rtaen t 
OFFICE OF THE CONTROLLER 

Edward Harrington 
Controller 

John W. Madden 
Chief Assistatrt ControDer 



April 21, 1999 



Ms. Gloria L. Young, Cleric of the Board 

Board of Supervisors 

City HalL Room 244 

1 Dr. Carlton B. Goodlen Place 

San Francisco, CA 941 02 

RE: Amendment to the Memorandum of Understanding with SETU Local 790, 535, 250 
File No. 99-0671 

Dear Ms. Young: 

In accordance with Ordinance 92-94, I am submitting a cost analysis of an amendment to the memorandum 
of understanding between the City and County of San Francisco and Service Employees International 
Union (SETU) Locals 790, 535, and 250. The xrv -nrim~nr covers the period Jury 1 , 1 999 through June 30, 
2000, and affects approximately 5392 employees with a salary base of approximately S236 million. 

Based on our analysis, the amendment will result in incremental costs, including salaries and fringe 
benefits, of approximateiy $1,122,000 in FY 1999-2000. The amendment will result in a cost increase of 
approximately .48% above base salaries for FY 1999-2000. 

If you have any additional questions or concerns please contact John Madden at 554-7500. 



Sincerely, 

(-Edward M riarrington 
Controller 



Vicki Rambo, ERD 

Harvey Rose, Budget Anahst 



415-554-7500 



City U • 1 Dr. Cirtloc B. Goodies PUer - Ira SU • Sam Franojce CA. MH&404 



FAX 41SSSi-'*U 



40 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Item 6 - File 99-0672 



Department: 



Item: 



Location: 



Purpose of 
Lease Agreement: 



Lessor: 

Lessee: 

No. of Sq. Ft. 

Description: 



Lessor's Option to 
Expand: 



Port 



Resolution approving a lease agreement with Allright Cal, 
Inc. and the City and County of San Francisco operating by 
and through the Port Commission to operate one surface 
parking lot at Seawall Lots 321, 323, 324 located at 
Embarcadero, Broadway and Green Streets. 

Seawall Lots 321, 323, 324 located at Embarcadero, 
Broadway and Green Streets. 



To provide space for the continued operation of one existing 
public surface parking lot with a capacity of 410 vehicles. 

City and County of San Francisco 

Allright Cal, Inc., d.b.a. City Parking Company 

101,587 square feet 

The proposed subject lease agreement between the Port and 
Allright Cal, Inc. would authorize Allright Cal, Inc. to 
operate a public parking lot accommodating 410 vehicles at 
the Port's Seawall Lots 321, 323, and 324 located at 
Embarcadero, Broadway and Green Streets. 

The parking lot is on a parcel which has been designated as a 
future development site for a hotel project. In accordance 
with the subject lease agreement, with five daj r s written 
notice, the Port and the hotel developer may enter the 
subject parcel to perform planning and pre-construction 
activities related to the development project. 



Under the provisions of the proposed lease, the Port may 
exercise the option to allow Albright Cal, Inc. to expand 
parking operations in space north of the Fern* Building. 
According to Mr. Lozovoy, two such expansion sites may 
become available, one located at Pier 27/29 and one located 
at Pier 1. The additional space at Pier 27/29 consists of 
approximately 70,000 square feet and would accommodate 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



41 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



Rental Payment 
By Lessee to Citj" 



approximately 285 additional vehicles, according to the Ports 
estimates. The space at Pier 1 consists of approximately 
75,000 square feet and would accommodate approximately 
200 additional vehicles, according to the Port's estimates. 
Such expanded parking operations are for purposes of 
accommodating public parking demand related to a potential 
increase in cruise ship business as well as special events and 
emergencies. 



The rental rate payable by Allright Cal, Inc. to the Port 
would be $67,198 and the annual rental amount would be 
$806,376, subject to annual CPI adjustments. If the Port 
exercises its option under the lease to expand its parking 
operations north of the Fern- Building, the Port would 
receive 66% of the monthly parking revenues. Mr. Lozovoy 
estimates that the rental rate payable by Allright Cal, Inc. to 
the Port for the Pier 27/29 potential expansion site would be 
$28,215 per month ($338,580 annually), and the rental rate 
payable by Allright Cal, Inc. to the Port for the Pier 1 
potential expansion site would be $19,800 per month 
($237,600 annually), however, according to Mr. Lozovoy, any 
expansion to Pier 1 would only be for approximately two 
months, consistent with the development plan for Pier 1. 



Increase in Base 
Rental Revenues: 



Mr. Lozovoy reports that the Port currently has a month-to- 
month lease with Central Parking Systems, Incorporated for 
the operation of the parking lot on Seawall Lots 321, 323, 
and 324. 



The current base rental rate payable by Central Parking 
Systems to the Port is $38,060 per month, which results in a 
current total annual base rental revenue of $456,720. As 
previously noted, under the proposed lease, the new monthly 
rent of $67,198 for lease of the subject parcel would result in 
a total of $806,376 payable to the Port. Therefore, the 
proposed rental payments would result in an increase of 
$29,138 per month, or $349,656 per year, an increase of 
76.56%. 



Term of Lease: 



Two years, commencing on the first day of the month 
immediately following the Board of Supervisors approval of 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



42 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



the proposed lease. The Port retains the right to terminate 
the lease upon 60 days written notice to the lessee. 



Right of Renewal: None. 



Insurance 
Provision: 



Albright Cal, Inc. would be required to maintain Garage 
Liability and Garage Keeper's Insurance with a limit of not 
less than $1,000,000, in addition to Workers Compensation, 
Comprehensive General Liability and Comprehensive 
Automobile Insurance. 



Comments: 



1. On July 29, 1998, the Port issued an Invitation for Bids 
(IFB). Attachment I, provided by the Port, includes the 
names of all the publications in which the IFB was 
advertised and the dates of those advertisements. According 
to Mr. Lozovoy, a major goal of the Port Commission was to 
encourage the participation of minority-owned and 
economically disadvantaged businesses and the Port 
advertised in a wide variety of publications to reach 
MBE/WBEs. The Port received requests for 42 bid packages 
and ultimately received bids from 18 parking lot operators, 
56% of which were MBE/WBEs. Attachment II, provided by 
the Port, lists the 18 companies that responded to the IFB 
and the monthhy bid amounts submitted by each. As noted 
in Attachment II, Albright Cal, Inc. was the high bidder. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

43 



FPR 20 '99 01 :48PM PORT OF SF flCCT 



Attachment I 



P. 1/2 



San Francisco Chronicle and Examiner 
Asian Week 
The Oakland Tribune 
Philippine News 
San Francisco Business Times 
Sun-Reporter 

San Francisco El Latino Newspaper 
City Purchasing Department 
Contra Costa Times 



-j>C A~P£ Fao*^ sji to sy^yVs 



Post-It" Drand tax transmittal memo 7571 • oi e>»9« ► ~2_ 



C, Hoft-jp 



M. Lo"ZOV 



p^. 



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{ 



PPR 20 '99 01 :48PM PORT OF ST ftCCT Attachment II p. 2/2 

Port of San Francisco 
Parking Lot Bids 

September 15, 1998 

PARCEL II 

Seawall Lots 321,323 an d 324 

Minimum Bid: $38,060.80 



1 


Aiirighc Cal, Inc. 


$67,198.00 


2 


ABC Parking, Inc. 


67,000.00 


3 


San Francisco Parking Incorporated 


67,000.00 


4 


Central Parking System, Inc. 


65,000.00 


5 


Park Bay Inc. 


64,671.00 


6 


Imperial Parking- Inc. 


60,833.00 


7 


Ampco System Parking 


60,257.00 


8 


Federal Auto Parks, Inc. 


'58,555.05 


9 


City Parking Company 


57,865.00 


10 


Parking Company of America, Management, LLC 


57,000.00 


11 


GDA Holding, Inc. 


55,620.00 


12 


Grefalco Co., Inc. 


54,444.00 


13 


US Parking, Inc. 


53,938.00 


14 


K.T. Park Corporation 


53,851.00 


15 


Car Park Management Corp. 


53,425.00 


16 


Pacific Park Management, Inc. 


52^302.82 


17 


Optima Investment, Inc. /dba Bay Parking Co. 


44,100.00 


18 


Parking Concepts, Inc. 


41,011.00 



'"Dvimimlol bids 



45 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Item 7*~- File 99-0617 



Departments: 
Item: 

Location: 
Purpose of Lease: 

Lessor: 

Lessee: 

Square Footage: 

No. of Sq. Ft. and 
Rent per Month: 



Public Utilities Commission (PUC) 
Water Department 

Resolution authorizing a 40-year lease of Water 
Department land between the City and County of 
San Francisco and Cisco Sj'stems, Inc. in Santa 
Clara County. 



City of Milpitas, Santa Clara County, 
within the Milpitas Business Park. 



Rental Adjustments: 



located 



Parking lot, utilities, landscaping and ingress and 
egress to and from adjacent Cisco Systems, Inc. 
faculties 

City and County of San Francisco, through the 
Public Utilities Commission 

Cisco Systems, Inc. 

109,737 square feet, or approximately 2.52 acres 



Payable by Cisco Systems, Inc. to the PUC. The 
subject land consists of a total of 109,737 square 
feet, including 38,880 net rentable area, to be 
leased at approximately $.28 per square foot per 
month. 



Annual Rent Payable 
By Cisco S5 r stems, Inc. 
To PUC: 



$129,120, or $10,760 per month 

Rent to be adjusted every five years, in accordance 
with the annual Consumer Price Index, of not less 
than two percent or more than five percent. In 
addition, every ten years, rent would be adjusted to 
the prev ailin g fair market value, based on current 
land values as determined by PUC appraisal, less a 
ten percent discount due to the inability to 
construct buildings on the property and the City's 
retained rights for the PUC's underground 
faculties. 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



46 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



Term of Lease: 



Description: 



Commences after approval by Board of Supervisors 
and Mayor and extends for 40 years, or through 
approximately April of 2039. 

The proposed resolution would authorize a 40-year 
lease of approximately 2.52 acres of Water 
Department property consisting of vacant land in 
the City of Milpitas, Santa Clara County, to Cisco 
Systems, Inc. for a parking lot, utilities, 
landscaping and ingress and egress purposes. 
Presently, this Water Department vacant property 
has a water pipeline under the surface of the land, 
which is used to transport and distribute water for 
municipal purposes. Under the proposed lease, the 
PUC would retain all rights to operate, maintain, 
repair and/or reconstruct these PUC facilities. 

In 1996 and 1997, the Board of Supervisors 
approved two 40-year leases of Water Department 
property for use by Cisco Systems, Inc. in the City 
of San Jose in Santa Clara County (Resolution Nos. 
1073-96 and 410-97) for similar parking, utility and 
landscaping purposes. The 1996 lease was for 
approximately 2.67 acres of land and the 1997 
lease was for approximately 4.41 acres of land, for a 
total of approximately 7.08 acres of land. These 
existing 40-year leases are located between Rio 
Robles and North First Street and Zanker R.oad 
and Coyote Creek near the Agnews State Hospital 
in northern San Jose. 



Comments: 



The proposed lease, although located in the City of 
Milpitas, is located just east of the previous leases, 
and will allow Cisco Systems, Inc. to provide 
additional parking and access to their facilities. In 
addition, Cisco is currently constructing a five- 
building campus in the recently purchased Milpitas 
Business Park, which is also located adjacent to the 
subject PUC property. 

1. Section 9.118 of the City's Charter requires that 
leases of real property in excess of ten years, or 
having anticipated revenue of at least $1 million be 
subject to the approval of the Board of Supervisors. 
The proposed lease would extend for a period of 40 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



47 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



years and would result in revenues exceeding $5 
million, not including the future escalation clauses. 

2. According to Mr. Gary Dowd of the PUC, the 
original grant deed limits approximately 65 
percent, or 70,857 square feet of the total lease 
area of 109,737 square feet, to agricultural, 
landscaping and egress and ingress purposes and 
prohibits the charging of rent for this area. Mr. 
Dowd notes that only the remaining 38,880 square 
feet (total area of 109,737 square foot less 
restricted area of 70,857 square foot) of the 
proposed lease area would be used for a parking lot 
by Cisco Systems to accommodate approximately 
240 vehicles. Therefore, Mr. Dowd notes that the 
rental rate was calculated only on this remaining 
38,880 square feet. Assuming a rental rate of 
$10,760 per month for this parking facility, and a 
total of 240 vehicles represents an average rent of 
approximately $45 per month per vehicle. 

3. Mr. Dowd states that the proposed lease rate of 
approximately $.28 per square foot per month for 
the 38,880 square feet of land represents the fair 
market lease rate for the subject property, based on 
comparable sales prices for adjacent parcels, less a 
ten percent discount, because the PUC does not 
permit structures to be built on the property and to 
allow access rights to the pipeline b> r the PUC, and 
assuming a nine percent rate of return. 

4. According to Mr. Dowd, because Cisco is the only 
adjacent property owner, and given the restrictions 
on the PUC's property which prohibit construction 
of any buildings and require access to the pipeline 
by the PUC, there is no other potential use of the 
proposed property. Mr. Dowd notes that there has 
not been a previous lease on this property and the 
City currently receives no revenue from this parcel. 

5. Mr. Dowd notes that under the proposed lease, 
Cisco Systems, Inc. would be responsible for all 
land maintenance costs and for paying all property 
taxes and assessments on the subject property. Mr. 
Dowd estimates that the PUC currently spends up 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



48 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



to approximately $1,000 per year for weed 
abatement and other maintenance responsibilities 
on the property. In addition, Mr. Dowd notes that 
the PUC currently pays a total of $426 in annual 
property taxes to Santa Clara County. 



Recommendation: Approve the proposed resolution. 



BOARD OF SUPERVISORS 
BUDGET ANALYST 

49 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 

Item 8 - File 99-0602 



Department: 
Item: 



Description: 



Comment: 



San Francisco Redevelopment Agency (SFRA) 

Hearing to consider the Redevelopment Agency's 
financial and performance reports for the quarter 
ending December 31, 1998 and a status report on 
prior year appropriations. 

The Board of Supervisors approved Resolution No. 
330-94 in April of 1994, requiring that the SFRA 
provide a quarterly report to the Board of 
Supervisors on the Agency's fiscal condition and 
performance and on temporary personnel 
assignments that have been extended, or may be 
extended beyond six months. Resolution No. 330-94 
also requires that periodic public hearings be held 
by the Board of Supervisors to consider the status 
of all SFRA programs. 

The subject quarterby report, which is contained in 
the Board of Supervisors file, is actually for the last 
two quarters of 1998, from July 1, 1998 through 
December 31, 1998 and consists of (1) a summary 
report showing actual expenditure variances with 
the SFRA's FY 1998-99 budget by project and by 
Personnel and Administration expenses (See 
Attachment I); (2) a Project Status Report for each 
SFRA project; and (3) a fisting of temporary 
personnel assignments that have extended or ma}' 
be extended beyond six months (See Attachment 
II). 

As shown in Attachment I, provided by the 
Redevelopment Agenc3% during the first six months 
of the fiscal year from July 1, 1998 through 
December 31, 1998, the San Francisco 
Redevelopment Agency expended and encumbered 
$36,745,736, or 37 percent of their revised budget, 
leaving a remaining balance of $61,666,839 or 
approximately 63 percent of the total revised 
budget for FY 1998-99. Ms. Tiza Peterson of the 
Redevelopment Agency reports that as of March 31, 
1999, after the completion of the third quarter of 
the fiscal year, the Redevelopment Agency had 

BOARD OF SUPERVISORS 
BUDGET ANALYST 



50 



Memo to Finance and Labor Committee 

April 28, 1999 Finance and Labor Committee Meeting 



expended and encumbered approximately 
$60,000,000 or 61 percent of their revised budget, 
leaving a remaining balance of approximately 
$38,400,000, or 39 percent of their revised budget. 
Ms. Peterson further reports that given the various 
debt payment schedules for each of the 
Redevelopment Agency's projects, the expenditures 
are not necessarily expended evenly throughout the 
fiscal year. For example, Ms. Peterson reports that 
approximately a $12.6 million payment for the 
Yerba Buena project will not be completed until 
after June 30, 1999, although it is included in the 
current FY 1998-99 budget. 




"7-/ 



/ t ~T\^ 



arvev M. Rose 



cc: Supervisor Yee 
Supervisor Bierman 
President Ammiano 
Supervisor Becerril 
Supervisor Brown 
Supervisor Katz 
Supervisor Kaufman 
Supervisor Leno 
Supervisor Newsom 
Supervisor Teng 
Supervisor Yaki 
Clerk of the Board 
Controller 
Legislative Analyst 
Matthew H\-mel 
Stephen Kawa 
Ted Lakey 



BOARD OF SUPERVISORS 
BUDGET ANALYST 



51 



'APR. 22. 1999 5:46PM S.F. R2DEVEL0PTENT AGENCY 



NO. 452 P. 2/2 

Attachment I 



San Francisco Redevelopment Agency 
Summary 



Variance Report for Fiscal Year 98/99 



Rcportmg Period; 07/01/98-12/31/98 

Project 

Yerba Buena 

Arts Center and Gardens 

Rincon Point- South Beach. 

South Beach Harbor 

Hunters Point 

India Basin 

Western Ad„A2 

South Bayshore 

HJP. Shipyard 

South of Market 

Citywide Housing 

HOPWA* 

Central Relocation 

Economic Development 

Federal Office Bldg(GSA Site) 

Golden Gateway 

Trans Bay Terminal 

Mid Market 

Mission Bay 

Subtotal: Work Program 
Personnel Expenses 
Administration Expenses 
Grand Total 



Approved 

Budget 

30,169,000 

5,997,000 

10,227,000 

1,699,000 

466,000 

368,000 

8,038,000 



7,832,000 

4,405,000 

6,179,000 

8,000,000 



1,207,000 

50,000 

5,136,000 





70,000 

89,843,666 



Revised 

Badssl 

29,959,000 

5,997,000 

10,227,000 

1,699,000 

466,000 

368,000 

8,038,000 



4,471,575 

4,405,000 

5,907,000 

8,528,000 



1,207,000 

50,000 

5,136,000 





70,000 

86,528,575 



Actual& 

F.ncnrnb»n»rf 

6,503,496 

5,477,665 

2,582,472 

1,199,547 

291,139 

263,138 

5,186,477 



160,825 

57,741 

1,718,445 

4,463,140 



1,145,000 



3,242,367 





13,026 



Remaining 

23,455,504 

519,335 

7,644,528 

499,453 

174,861 

104,862 

2,851,523 

4,310,750 
4,347,259 
4,188,555 
4,064,860 

62,000 

50,000 

1,893,633 



56,974 



9,945,000 
1,939,000 
$101,727,666 S 



9,945,000 

1,939,000 

98,412,57$ S 



32,304,478 

3,576,651 

871,207 

36,745,736 



54,224.097 

6,374,949 

1,067,793 

5 61,666,^39 



The Agency is the designated administrator fox the City's HOPWA program. 



■4/22/99 



8uml231 



52 



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